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Dollar Rally Fades as Odds of Fed Move This Year Drop Below 50%

  • Fed’s Brainard urged ‘prudence,’ while U.S. data disappointed
  • Odds of Fed move this year has risen to 65% after Jackson Hole
Bloomberg business news

Summers: 'No Compelling Case' for September Rate Hike

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The dollar rally is coming undone in a week that saw dovish Federal Reserve comments combine with disappointing economic data to cut the odds of higher interest rates this year to below 50 percent.

A gauge of the greenback fell from the highest this month after Fed Governor Lael Brainard started the week by saying the case for tighter policy was “less compelling.” Her speech was followed by a retail-sales report that fell short of analysts’ forecasts, while a measure of data surprises slid to the lowest since June. The odds of Fed action by year-end are the lowest in a month, while those for next week’s meeting have fallen to 18 percent.