The U.S. Dollar Index, or DXY, briefly fell to its lowest level since May on Aug. 14 after weaker-than-expected U.S. retail sales data led traders to cut back expectations for further rate hikes this year. Following the release, bond traders also pulled back wagers that the Federal Reserve would raise borrowing costs in 2026. That tightening narrative had been supporting the dollar for months, making the latest move a notable shift in positioning. The decline also left the greenback on track for a weekly loss for the sixth time in the past seven weeks. Recent pressure on the dollar has been building since last Friday’s softer-than-expected labor market report, while this week’s mild inflation data added to the move, according to Jin10 as cited by BlockBeats.
The U.S. Dollar Index (DXY) briefly fell to its lowest level since May on Aug. 14 after weaker-than-expected U.S. retail sales data prompted traders to further reduce expectations for additional rate hikes this year.
After the data release, bond market traders also pulled back bets that the Federal Reserve would raise borrowing costs in 2026. That tightening view had been supporting the dollar in recent months.
The latest drop puts the dollar on track to post a weekly decline for the sixth time in the past seven weeks. Pressure on the currency had already been building after a softer-than-expected labor market report released last Friday, and this week’s mild inflation data added to the recent slide. The report was attributed to Jin10 by BlockBeats.
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