Headline: Dollar Slips as Data Delays Cloud Fed Outlook; Aussie Outperforms on Jobs Beat
The US dollar edged lower in early forex trade as investors grappled with a murky data backdrop following the end of the extended US government shutdown. With key economic releases still in limbo, markets are reassessing the Federal Reserve’s policy path while risk currencies find some support.
Major pairs were mixed: EUR/USD advanced about 0.2% to 1.1610, GBP/USD hovered near 1.3130 after dipping to 1.3100 on softer Q3 UK GDP, and USD/JPY eased to 154.65 as the pair continues to test—but not clear—the 155.00 threshold. Despite the shutdown’s resolution, September non-farm payrolls and retail sales remain pending, and officials have signaled October labor market and inflation reports may not be published, leaving a significant gap in the macro picture. In this vacuum, markets are pricing roughly 55% odds of a rate cut at the next Fed meeting, while recent surveys indicate a strong majority expect a 25 bp reduction by year-end.
The Australian dollar led gains, with AUD/USD up around 0.6% to 0.6578 after a robust employment report, though the pair remains rangebound between 0.6400 and 0.6600, a band held since June. The lack of timely US data keeps uncertainty elevated ahead of the next FOMC decisions, complicating rate expectations and reinforcing sensitivity to any incoming signals on growth, inflation, and labor market conditions.
Key Points: – US dollar broadly softer; EUR/USD near 1.1610, GBP/USD around 1.3130, USD/JPY below 155.00 – Data delays persist despite the shutdown ending, with September and potentially October releases still missing – Market-implied odds suggest about a 55% chance of a Fed rate cut at the next meeting – Surveys indicate roughly 80% expect one additional Fed cut by year-end, likely 25 bps – AUD/USD outperforms to 0.6578 on strong jobs data but remains in a 0.6400–0.6600 range – Softer UK GDP weighed on sterling intraday, while uncertainty around US data keeps volatility risks elevated
