
The dollar index (DXY00) this morning is down by -0.09%. The dollar is under pressure today due to a rebound in stocks, which reduces liquidity demand for the dollar. Also, a decline in T-note yields today is weighing on the dollar. Losses in the dollar are contained as expectations for Fed rate cuts have fallen. According to federal funds futures contracts, the chance of a Fed rate cut at the June FOMC meeting has dropped to 17% from 66% at the start of the month.
The markets are discounting the chances for a -25 bp rate cut at 3% for the next FOMC meeting on April 30-May 1 and 17% for the following meeting on June 11-12.