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The US Dollar Index (DXY) has experienced a temporary pause in its rally, aligning with declines in US Treasury yields. OCBC's FX Strategist Christopher Wong highlights that the absence of tier-1 US data today has shifted focus to upcoming FOMC minutes and flash PMI reports. These will provide insights into inflation persistence and economic activity momentum. The dollar's recent weakness reflects reduced yield differentials and uncertainty ahead of critical central bank communications. For traders, the FOMC minutes could signal Fed policymakers' stance on future rate hikes, while PMI data will gauge manufacturing and services sector health. Market participants are advised to monitor these events for potential volatility triggers in the coming weeks.
