US Dollar consolidates ahead of eventful week

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US Dollar consolidates ahead of eventful week
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US Dollar steady as traders await inflation data, Fed rate decision UnitedStates DollarIndex Macroeconomics

For this Monday, the Dollar Index is making a small recovery after its slide lower at the end of last week, dipping below 103.25. In the Asia-Pacific session, traders revalued the US Dollar back above 103.50 as Monday already holds an important event, the auction of 3-year and 10-year Treasury notes. The Federal Budget Balance for May will be printed as well on Monday.

The CME Group FedWatch Tool shows that markets are pricing in a 30% chance of rate hike for June and an 85% chance for a hike in July. The pause this week could trigger some further easing in the DXY. When inflation falls below 2% or the Unemployment Rate is too high, the Fed may lower interest rates to encourage borrowing, which weighs on the Greenback.The Federal Reserve holds eight policy meetings a year, where the Federal Open Market Committee assesses economic conditions and makes monetary policy decisions.

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