By Maria Agustina Patti, Financial Markets Strategist Consultant to Exness
The dollar index traded steadily on Friday, with investors in wait-and-see mode ahead of the US CPI release, a key risk event that could inject volatility into both the dollar and Treasury markets. The 10-year hovered near the 4% threshold as traders awaited new data.
September’s CPI print is expected to show a 0.4% increase in the headline gauge and a 0.3% rise in the core measure on a monthly basis. While the data is unlikely to derail a widely anticipated 25-basis-point rate cut next week, a stronger-than-expected reading could influence the Federal Reserve’s future decisions and temper market expectations for further easing. Conversely, softer inflation may reinforce the dovish narrative, pressuring both the dollar and yields.
On the geopolitical front, sentiment remains tied to US–China trade developments, with Washington confirming that President Donald Trump will meet President Xi Jinping in South Korea next week. While positive developments could boost the greenback, any setback could raise concerns over US economic growth and trigger a rush to safe-haven assets like gold.