Dollar Index Lower
Action Economics: The dollar has shown little reaction to the slightly weaker than forecast September new home sales data, and the downwardly revised August data. The market had largely been priced in for more housing sector weakness, and as a result, some short covering may become a short term feature. Fed rate cut speculation will continue though, and overall, traders appear to be raising their expectations for a 50 bp cut next week. Generally, we look for the greenback to continue to lose ground in the bigger picture.
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