The dollar index rose by +0.27% on Friday, hitting a 2.75-month high. Hawkish comments from Fed officials and positive economic data boosted the dollar. The FOMC is not expected to cut rates in December. However, ongoing US government shutdown pressures may lead to rate cuts.

The US Oct MNI Chicago PMI beat expectations, rising to 43.8. Fed officials like Schmid, Logan, and Hammack opposed rate cuts due to strong economic indicators. Markets predict a 63% chance of a 25 bp rate cut in December.

EUR/USD fell to a 2.75-month low due to dollar strength. Eurozone economic data was positive, supporting the euro. The ECB is done cutting rates, while the Fed may cut by another percentage point by 2026.

Japan’s Sep industrial production beat expectations, rising by +2.2% m/m. Sep retail sales were weaker than expected. Oct Tokyo CPI exceeded expectations, strengthening the yen. Precious metals fell on a stronger dollar, hawkish Fed comments, and easing US-China trade tensions.

Read more at Yahoo Finance: Dollar Gains and Gold Falls on Hawkish Fed Comments