Forex News: U.S. Dollar Falls Amid Rising Fed Rate Cut

U.S. Dollar Falls Amid Rising Fed Rate Cut Bets

(RTTNews) - The U.S. dollar weakened against other major currencies in the late Asian session on Monday, due to growing speculation that the U.S. Federal Reserve (Fed) may lower interest rates at its September meeting.

According to reports, San Francisco Fed President Mary Daly stated that officials will soon be prepared to lower interest rates and that tariff-related inflation will probably only last temporarily.

Traders also are concerned about the renewed uncertainty about U.S. President Donald Trump's reciprocal tariffs after a U.S. federal appeals court ruled that the majority of his sweeping tariffs were illegal.

In delivering a stunning legal blow to Trump's trade policy, the court said the president overstepped his authority in imposing a series of tariffs -- including duties on China, Mexico, and Canada-under the International Emergency Economic Powers Act.

Meanwhile, Trump defended $183.1 billion in tariff revenues as economic driver after a U.S. appeals court declared most of his tariff's illegal, giving the administration until October 14 to appeal to the US Supreme Court.

In the late Asian trading today, the U.S. dollar fell to near 2-week lows of 1.1734 against the euro and 1.3540 against the euro, from early highs of 1.1688 and 1.3502, respectively. If the greenback extends its downtrend, it is likely to find support around 1.17 against the euro and 1.36 against the pound.

Against the yen and the Swiss franc, the greenback edged down to 146.79 and 0.7986 from early lows of 147.38 and 0.8012, respectively. The greenback may test support near 145.00 against the yen and 0.78 against the franc.

Looking ahead, U.S. Dallas Fed PCE index for July is due to be released in the New York session.

The U.S. stock markets remain closed today in observance of the Labor Day holiday.

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