The dollar declined but was set for a second week of gains against major currencies, fueled by strong U.S. economic data. Consumer spending rose 0.6% in August, exceeding estimates. The Fed’s preferred inflation gauge, the PCE Price Index, also increased by 0.3%. This has tempered expectations of rate cuts, boosting the dollar.

Richmond Fed President Barkin sees limited risks of high unemployment or inflation, allowing the Fed to balance its goals amidst rate cut talks. Vice-chair Bowman believes decisive rate cuts are necessary to counter job market issues. Traders anticipate an 89.8% chance of a 25 basis-point cut at the next Fed meeting.

The dollar index fell 0.33% to 98.17 but remained on track for a second consecutive week of gains. Data revealed a 3.8% increase in GDP from April to June, surpassing forecasts. Bank of America analysts noted the USD’s stability and the lack of G10 support narratives, with a crucial jobs report on the horizon.

Read more at Yahoo Finance: Dollar set for second weekly gain amid US economic resilience