As market analysts have warned, the US dollar showed a strengthening value on Monday's trading yesterday while still moving in its path to weaken for the expected period ahead.
Market movements were slow at the opening of the session early in the week, but the US dollar began to show recovery at the beginning of the New York session before being supported by the speech delivered by the Chairman of the Federal Reserve (Fed) Jerome Powell.
Powell injected hawkish remarks into the market's current buoyancy, slightly reducing earlier expectations of another 50 basis point cut at the November meeting.
According to Powell's view, the latest assessment of economic growth, savings rates and personal income of consumers is seen to reduce concerns about the economy that the central bank is currently focusing on.
However, he sees the possibility of two more interest rate cuts at the end of this year with a total of 50 basis points of cuts if the economy performs as well as projected.
The 'less dovish' statement by Powell slightly reduced the pressure on the US dollar, but investors still need to remain cautious with some important economic data that will be published this week.
The main focus will be on the US NFP jobs report at the end of the week which will provide the latest Fed guidance for policy setting.
The US dollar for the near term is seen to still have the potential to continue strengthening its value if yesterday's momentum is successfully maintained, but a change in the situation is not impossible.
European inflation data will be in focus shortly before markets move into the New York session to assess the US manufacturing sector survey and JOLTS employment data.
