Against this backdrop, the December rate hike expectations have declined from over 90% to just 73%, while the 2019 rate hike outlook has shifted as well. So far, the reemerged trade war fears cap the buck’s downside po-tential, but should the officials confirm their softer stance on policy tightening due to global risks, the trade factor won’t be able to support the USD as its safe-haven status could weaken.
In this context, traders will closely follow comments by New York Fed President John Williams later today. As Williams is considered a centriston , his statement could both support and pressure the buck, depending on his position.
In a wider picture, the dollar trading ranges could narrow this week due to a Thanksgiving day effect in FX mar-kets, followed by Black Friday. Amid the heightened uncertainty over the Fed’s position, the path of least re-sistance for the dollar is on the downside.