Overview
- The dollar weakened after Friday's jobs report showed the U.S. economy lost about 23,000 payrolls and revisions trimmed prior gains, cutting the labour-signal that had supported more Fed hikes.
- Futures markets have scaled back the chance of a September rate increase to roughly 44 percent from about 67 percent last week, reflecting the rapid repricing of Fed expectations.
- Benchmark 10-year Treasury yields fell to around 4.637 percent as investors moved into bonds on the weaker jobs print and sought safer assets.
- Oil traded near $85 a barrel because talks to reopen the Strait of Hormuz remain unresolved and Iran has set conditions for shipping lanes, keeping upside pressure on energy-driven inflation risk.
- Wednesday’s U.S. consumer price data is the key near-term test because a stronger than expected print would push odds of another hike back up and raise borrowing costs for households and businesses.