The dollar continued its slight upward climb, ignoring market expectations of approximately three more rate cuts by the Federal Reserve.

The dollar rose slightly for the second consecutive trading day, completely ignoring market pricing in expectations of about three Federal Reserve rate cuts this year. Options markets showed that recent bearish sentiment towards the dollar has eased, with the so-called front-end risk reversal indicator falling to its lowest negative level in nearly a month. The currency market still expects the Fed to cut rates by about 64 basis points by the end of the year. Some strategists believe this expectation is excessive, as three rate cuts may exceed the reasonable range supported by data, which would expose the market to the risk of a dollar rebound. Elias Haddad, global head of market strategy at Brown Brothers Harriman, said, "Expectations of Fed rate cuts seem a bit excessive, which provides room for adjustment in the short-term strength of the dollar." He pointed out that economic growth is strong and inflation has remained above the Fed's 2% target. (Jinshi)