The dollar is heading to record its largest weekly decline in 4 months

The dollar is heading towards recording its largest weekly decline in four months today, Thursday, with trading volumes declining due to the Thanksgiving holiday in the United States, which made traders think about next year while the Federal Reserve (the US central bank) appears to be the only one that will cut interest rates..

The dollar index, which measures the performance of the US currency against a group of major currencies, settled at 99.433 after declining from the highest level in six months that it recorded a week ago, heading towards recording the largest weekly decline since July..

“The market will soon be thinking about the big deals of 2026, and I strongly doubt that ‘buying the dollar’ will be one of them,” said Spectra Markets President Brent Donnelly.“.
He explained that if White House economic advisor Kevin Hassett, an advocate of lowering interest rates, is appointed as the next Chairman of the Federal Reserve, this should be a negative indicator for the dollar..

In addition, the yen rose 0.4 percent to 155.87 per dollar in Asian trading, supported by a shift in the tone of Bank of Japan officials towards tightening monetary policy, while the euro increased above $1.16..

The New Zealand dollar rose again to its highest level in three weeks at $0.5728 and has risen by about two percent since the central bank turned to tighten monetary policy yesterday, Wednesday..

The Reserve Bank of New Zealand cut interest rates, but yesterday it said that stabilizing interest rates had been discussed and indicated that the monetary easing cycle was likely over. Markets expect interest rates to rise again by December 2026.

The Australian dollar also rose after higher-than-expected inflation data yesterday, Wednesday, which reinforced the view that the monetary easing cycle there has also ended..

The pressure from the Chinese central bank’s stabilization mechanism led to the yuan stabilizing at 7.08 against the dollar.

The pound sterling rose to its highest levels since late October at $1.3265, heading for its largest weekly rise since August as Britain’s budget helped alleviate some concerns about national financial conditions..