BUSINESS – The U.S. dollar eased in early Asian trading after private-sector data revealed job losses in October, prompting investors to scale back expectations of imminent hikes and increase wagers on a potential interest-rate cut by the Federal Reserve. With the release of official employment figures delayed by the government shutdown, traders turned to alternative indicators showing signs of softening in the labour market. Private surveys and outplacement firm reports suggest the economy shed jobs, particularly in government and retail sectors, as companies pursue cost-cutting and expand adoption of artificial intelligence.
In foreign exchange markets, the U.S. Dollar Index—which tracks the greenback against six major currencies—hovered around 99.67, down roughly 0.5 percent. The slide came after the currency had gained earlier in the week, reflecting renewed caution among investors. Data indicated that layoffs reached levels unseen in recent years, causing market participants to reassess the strength of the U.S. labour environment.
Despite the employment weakness, the dollar did show some resilience. In a separate Reuters report, the dollar rebounded modestly amid disappointing Chinese trade figures, which triggered safe-haven flows. Nonetheless, the predominant theme remains one of uncertainty: muted wage growth, lay-off spikes and delayed official data have combined to cloud the labour picture.
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The expectations for the December Fed meeting now reflect approximately a 70 percent probability of a rate cut, up from 62 percent earlier this week. That shift signals the market is increasingly pricing in accommodation in the face of labour-market weakness and broader economic risks.
Analysts emphasise that while the unemployment headline figures remain unchanged, the surge in announcements of corporate job cuts and the disappearance of hiring momentum has moved the market from “no hire, no fire” to “no hire, more fire”—a marked change in sentiment.
Furthermore, the shutdown of major employment-related data releases such as the non-farm payrolls and job-openings reports has forced the Fed and markets to rely on private-sector indicators, which are less familiar and add to the uncertainty. Deputy officials caution that the paucity of official inflation and labour metrics “accentuates” hesitation around further policy action.
Moving forward, all eyes will be on the upcoming official data releases, corporate employment announcements, and inflation signals. Each will carry amplified weight in shaping views on whether the labour market is merely cooling or entering a broader downturn, and will heavily influence the dollar’s direction and the Fed’s policy path.
