The US dollar enters December under pressure, with markets heavily pricing in a Fed rate cut next week amid a softer labor market and the scheduled end of quantitative tightening, notes Philip Wee, chief FX strategist at DBS.
The US dollar is looking to weaken at the end of the year ahead of the Federal Open Market Committee meeting
“The US dollar enters the final month of 2025 with high expectations that the Fed will cut interest rates at next week’s FOMC meeting on December 10.”
“U.S. Labor Secretary Lori Chavez de Remer, Fed Chair John Williams (New York), and Mary Daly (San Francisco) viewed the risks from a weak labor market as outweighing the rationale for keeping interest rates high for longer amid weak demand and tightening credit conditions.”
“The Fed is also scheduled to end quantitative tightening on December 1 by reinvesting maturing securities rather than allowing them to trade.”
