Early trade in New York: dollar Stabilises as case for Fed rate pause solidifies

Expectations for an interest rate cut do not rise above 30% before July 2020, according to CME Group's FedWatch tool. And the slim chances of a cut in the months prior became slimmer on Wednesday.

US consumer prices jumped by the most in seven months in October, a report from the Labor Department showed, as the cost of healthcare surged by the most in more than three years. The Fed has cut interest rates three times this year in part due to low inflation.

The dollar index was up 0.04% to 98.349 and also gained 0.05% against the euro to $1.100.

Also on Wednesday, the Swiss franc rallied to a one-month high against the euro as hedge funds unwound some of their negative bets against the currency and as appetite for risky assets faltered.

Boosting demand for safe-haven assets were the police crackdown against protesters in Hong Kong and a speech by US President Donald Trump in which he threatened to raise tariffs on China and criticized European Union trade policies before a Nov. 14 deadline to decide whether to raise tariffs on European and Japanese carmakers.

Copyright Reuters, 2019

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