US dollar stable as Fed signals steady rates, market awaits key data

The US Dollar was relatively steady and was heading for a positive close this week.

Market participants digested the Federal Reserve’s latest policy stance. The central bank held interest rates steady and signalled no urgency to ease them.

This cautious approach, coupled with ongoing trade tensions that could add to inflationary pressures, could lend support to the greenback.

At the same time, uncertainty over US President Donald Trump’s protectionist policies and their impact on the economic outlook could affect the dollar’s performance.

A slowdown in consumer spending and economic growth could weigh on investor sentiment.

Yields were on track to end the week lower following the Fed’s decision to reduce the cap on monthly Treasury redemptions, a move that may ease pressure on longer-term rates.

Looking forward, attention shifts to next week’s GDP growth and Core PCE data. Softer numbers could renew speculation of rate cuts and pressure the dollar, while stronger readings may reinforce the currency.