Dollar Steady as Fed Rate Cut Speculation Grows

The U.S. dollar maintained stability amid speculations over the Federal Reserve's potential rate cut in December following dovish comments from officials. The yen stayed weak, with possible intervention hints from Tokyo. Meanwhile, improved U.S.-China relations highlighted global economic discussions.

The U.S. dollar showed stability on Tuesday as investors considered the likelihood of the Federal Reserve cutting interest rates next month, prompted by dovish remarks from policymakers. The Japanese yen continued to struggle, remaining in the spotlight for potential intervention.

Fed Governor Christopher Waller suggested the labor market's weakness justifies another quarter-point rate cut in December. His comments, along with those from New York Fed President John Williams, have shifted expectations notably, increasing the probability of a cut. Traders now see an 81% chance of such action compared to just 42% a week earlier.

The market remains keenly focused on the individual stances of Fed voters, with major attention on Fed Chair Jerome Powell's decision. Meanwhile, the ongoing improvement in U.S.-China relations also gained attention, as President Donald Trump praised the strong ties with his Chinese counterpart, Xi Jinping, following a recent call.

(With inputs from agencies.)