The rally in the US dollar appears to be losing steam

Amid the flurry of central bank announcements, the Fed doubling down on “higher for longer” proved to be enough for the greenback to eke out small gains against most other currencies, taking the DXY index to a tenth consecutive weekly rise. While comments from FOMC speakers could well drive the greenback even higher, we think that easing core price pressures in next week’s PCE data out of the US might provide the catalyst for the dollar taking a breather after its recent gains.