SINGAPORE — The U.S. dollar is on track for its strongest weekly performance in over a month as investors bet the Federal Reserve is unlikely to cut rates next month, following a mixed U.S. jobs report. The delayed September nonfarm payrolls showed employment growth accelerated, but the unemployment rate climbed to 4.4%, the highest in four years, leaving the Fed’s next move uncertain.
The euro hovered near a two-week low at $1.1528, while sterling edged up to $1.3084 but was set for a weekly loss. The dollar index, which tracks the greenback against a basket of major currencies, stood at 100.20, approaching a 5½-month high. Markets currently price in only a 27% chance of a rate cut in December.
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Meanwhile, the Japanese yen has tumbled to near a 10-month low, prompting Finance Minister Satsuki Katayama to signal possible intervention. The cabinet is set to approve a massive 21.3 trillion yen stimulus package, heightening concerns over fiscal stability and contributing to the yen’s weakness.
Investors and analysts are watching Japan closely, as interventions are expected to be opportunistic and short-lived, acting as “speed bumps” rather than long-term solutions. The yen’s decline has been further reinforced by October’s 3.0% year-on-year rise in core consumer prices, keeping expectations of a near-term rate hike alive.
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