Currency strategists noted a shift in sentiment, with National Australia Bank’s Ray Attrill describing a renewed “sell America” tone as traders reassessed risk and policy direction. Several Federal Reserve officials sharpened their caution over further easing, citing persistent inflation concerns and steadier labour-market signals. Yet the hawkish tilt failed to buoy the greenback, which slid to a two-week low against the euro on Thursday.
The euro held above $1.16, inching up to $1.1644, while the Swiss franc hovered close to a three-week peak at 0.7919 per dollar. The dollar index drifted near 99.14, pacing toward a weekly decline of roughly 0.4%.
Analysts said the coming flood of U.S. releases—some of which may be incomplete—could further cloud the economic outlook. Commonwealth Bank of Australia strategist Joseph Capurso warned that the data is “likely to be pretty bad,” though he noted that futures markets have not fully embraced the prospect of accelerated Fed easing. Adding to the uncertainty, the White House said October’s unemployment report may not be produced because the shutdown halted the household survey. Capurso likened the environment to “driving in the fog,” saying central bankers may slow the pace of cuts until visibility improves.
Market pricing now reflects just over a 50% chance of a 25-basis-point cut in December, with January almost fully priced for easing. Expectations for 2026 remain broadly stable.
Asian currency markets saw an active session, marked by sharp moves in the British pound and South Korean won alongside a firming onshore yuan. Sterling slipped 0.3% to $1.3152, reversing part of its overnight rebound after reports that U.K. Prime Minister Keir Starmer and Finance Minister Rachel Reeves had dropped plans for income-tax increases ahead of the November 26 budget. NAB’s Attrill noted that while the change may temper fiscal tightening, it could raise concerns among foreign buyers of British government debt.
South Korea’s won jumped 1% after authorities vowed decisive action to steady recent volatility, prompting speculation of dollar-selling intervention. Japan’s yen also found brief relief from the weaker dollar, inching to 154.51 per dollar, though it remained set for a 0.7% weekly loss.
In the Pacific region, the Australian dollar managed a modest rebound to $0.6538 despite lingering risk aversion tied to expectations of higher-for-longer U.S. rates. The New Zealand dollar rose 0.6% to $0.5687, supported by data showing an uptick in manufacturing activity and the Reserve Bank of New Zealand’s plan to loosen mortgage loan-to-value limits from December 1.
China’s onshore yuan touched a one-year high at 7.0908 per dollar, buoyed by exporter demand following a key technical break in the currency pair. But economic indicators underscored ongoing headwinds: October factory output and retail sales grew at their slowest pace in more than a year, while new home prices recorded their steepest monthly decline in 12 months.