[MARKET ANALYSIS] DXY marginally softens ahead of the FOMC mid-week where the Fed is widely expected to cut rates and will provide the latest dot plot projections

DXY: -0.1%

• Marginally softened amid slight gains in its peers and ahead of the FOMC mid-week where the Fed is widely anticipated to cut rates, while weekend newsflow from the US was relatively quiet, although there were comments from US President Trump who said that they will work it out, when asked if he would restart trade talks with Canada.

EUR/USD: +0.1%

• Eked marginal gains in quiet trade and with recent comments from ECB’s Rehn providing very little to shift the dial after he stated that they must be aware of upside and downside inflation risks, while he added that inflation risk is slightly tilted to the downside in the medium-term and that they should not impose unnecessary bars or floors on policy.

GBP/USD: +0.1%

• Lacks firm conviction in the absence of any major pertinent drivers with very little newsflow from the UK, aside from reports that former Deputy PM Angela Rayner will return to the cabinet after resigning in September.

USD/JPY: -0.2%

• Mildly retreated beneath the 155.00 handle amid a softer buck and as the latest wages data from Japan supports the case for the BoJ to hike rates at its meeting next week, although Q3 GDP revisions were disappointing and showed a wider-than-feared contraction.

Antipodeans: AUD/USD +0.1% / NZD/USD +0.3%

• Traded marginally higher with slight outperformance in NZD despite a lack of obvious catalyst, while AUD is kept afloat ahead of tomorrow's RBA decision, in which the central bank is widely expected to keep rates unchanged, and participants will be eyeing any hawkish clues to justify current money market pricing that the next move will be a hike in H2 next year.

08 Dec 2025 - 02:48- ForexData- Source: Newsquawk