US Dollar retreats as United States election uncertainty offsets upbeat service sector data.
ISM Services PMI surges, signalling accelerating growth in the sector despite ongoing political concerns.
Trump's election odds affect US Dollar amid expectations of inflationary policies.
The US Dollar Index (DXY), which measures the value of the USD against a basket of six currencies, retreats as uncertainty surrounding the upcoming US presidential election dampens gains from upbeat service sector data. Despite a surge in the ISM Services PMI indicating robust growth, concerns over the election outcome weigh on the Dollar's strength.
The US Dollar Index has recently declined due to increased probability of Kamala Harris winning the US presidential election and a disappointing October Nonfarm Payrolls (NFP) report released last week. The weak job growth data, despite rising wage inflation, has raised expectations of a less hawkish Federal Reserve (Fed) stance. In the meantime, markets are pricing in a 25-basis-point rate (bps) cut by the Fed this week, which could further weaken the US Dollar.
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