Dollar Weakened Amid Lower Rate Hike Bets and Growing Geopolitical Tensions

The U.S. dollar has been facing challenges recently, depreciating against major currencies. This decline is primarily due to the reduction in bets that the Federal Reserve (Fed) will increase its interest rates. Weak economic indicators such as retail sales and job losses are contributing to this trend. Traders now consider it less likely for a rate hike decision next month of September. However, elevated oil prices and growing geopolitical tensions in the Middle East are adding volatility to financial markets. Global bond yields are rising amid concerns over debt and fiscal discipline. This configuration reflects broader global economic deceleration trends, with Middle Eastern tensions particularly relevant for oil prices and international trade flows.