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The dollar is selling off and most major currency pairs are experiencing sharp trend reversals as investors bet on a less aggressive rate posture from the Federal Reserve. In a week defined by evidence of a slowing economy – consumer confidence, home prices, and manufacturing gauges all came in below expectations – many are reappraising Friday’s “stepping down” comments from the San Francisco Fed’s Mary Daly, and traders are now positioning for a slightly more cautious message from central bankers at next week’s meeting. We’re not confident such a dramatic shift in tone is coming before year end, but stretched...

The dollar is turning in a mixed performance this morning as Treasury yields slip and major currency pairs move in diametrically opposed directions. Ten-year yields are holding around 4.17 percent and the trade-weighted greenback is back to levels that prevailed at the beginning of the month, with the big European units inching upward even as Asia falls. The pound continues to ascend, building on gains achieved over the weekend when Boris Johnson pulled out of the race to succeed Liz Truss as British prime minister. With Rishi Sunak now at the helm, markets expect some semblance of fiscal orthodoxy to...