By Rae Wee and Stefano Rebaudo
(Reuters) -The dollar rose slightly on Monday as traders looked ahead to a slew of speeches from Federal Reserve officials throughout the week that could provide further clues to the U.S. rate outlook, after the central bank resumed its easing cycle last week.
The greenback hovered near levels seen before last week’s Fed decision. The current pricing is consistent with the central bank’s messaging, which highlighted rising concerns over the labour market as the key driver of policy, analysts said.
Last week’s U.S. economic data showed the number of Americans filing new applications for unemployment benefits fell, reversing the prior week’s jump.
“The lack of significant data until Friday’s core Personal Consumption Expenditures (PCE) inflation release leaves investors open to rethinking Fed rate cuts and the plan ahead,” said Bob Savage, head of markets macro strategy at BNY Mellon.
“Fed speakers will be important, with over 18 events planned,” he added, mentioning Chair Jerome Powell, but also the Cleveland Fed’s Beth Hammack and the St. Louis Fed’s Alberto Musalem given their hawkish view prior to the Fed meeting.
New Fed Governor Stephen Miran on Friday defended himself as an independent policymaker after dissenting in favour of a steeper 50-basis-point rate cut, and promised to give a detailed argument for his views in a speech later on Monday.
Analysts suggested that Miran’s lone dissent was a calculated move by the rest of the FOMC to show unity behind Chair Powell and reinforce the Fed’s institutional independence.
U.S. President Donald Trump criticised the Fed, urging the central bank to cut interest rates more aggressively.
The greenback was slightly lower after last week’s rebound when the Fed signalled little urgency to ease its policy in the coming months. It was up 0.05% at 97.66 against a basket of currencies.
The euro was flat at $1.1748.
The Swedish crown fell 0.10% to 9.4140 versus the greenback before the central bank policy meeting on Tuesday.
“If delivered, this will most likely be the final rate cut of this cycle for the Riksbank, in our view,” said Giada Giani, economist at Citi.
The yen slipped 0.10% to 148.06 per dollar, trimming last week’s gains, when a hawkish shift in the Bank of Japan’s rhetoric fuelled speculation of a near-term rate hike.
Sterling, meanwhile, fell to a two-week low of $1.3453, pressured by domestic headwinds after a surge in UK public borrowing and a BoE rate decision that laid bare the challenge for policymakers in balancing growth and inflation.
“We have pushed our forecast for the next move into 2026,” Jane Foley, head of FX strategy at Rabobank, said of the BoE’s next expected cut.
“However, with this mostly already priced in and with the attentions of GBP investors squarely focused on the UK fiscal backdrop, we remain of the view that GBP is set to be on the back foot into the autumn and potentially beyond.”
Elsewhere, the Australian dollar dropped 0.17% to $0.6575, its lowest level since September 8.
The yuan firmed slightly to stand at 7.1136 per dollar, underpinned by easing Sino-U.S. trade tensions and China’s decision to keep its benchmark lending rates unchanged.
(Reporting by Stefano Rebaudo and Rae Wee; Editing by Jamie Freed, William Maclean)
