After the Fed Rate Cut, the US Dollar Posts Its Worst Daily Performance Since September

BlockBeats News, December 11th, Federal Reserve Chairman Powell emphasized labor market risks in his speech while downplaying inflation concerns, leading to the dollar recording its worst performance in nearly three months.

The US Dollar Index closed down 0.4%, marking its largest decline since September 16th following the Fed's decision to cut interest rates by 0.25 percentage points. Alex Cohen, a strategist at Bank of America, said, "Powell's outlook on the labor market is less optimistic compared to previous forecasts." He added that the Fed chair's comments on labor and inflation triggered the dollar's fall.

Edward Harrison, a macro strategist, said, "As the Fed's stance diverges from increasingly hawkish central banks around the world, the weakened dollar should take guidance from the bond and rate differential direction." (FXStreet)