The US Dollar (USD) edged higher as markets scaled back expectations for Fed cuts in 2026, with the Dollar Index (DXY) hovering near 99, while investors await a busy week of US labor and trade data, OCBC's FX analysts Frances Cheung and Christopher Wong note.

DXY consolidates around 99 amid technical resistance

"USD was a touch firmer overnight as markets unwound some of its dovish expectations with regards to Fed cut trajectory in 2026. Markets now implied about 2 cuts vs. 3 cuts earlier for 2026."

"DXY last seen around 99 levels. Mild bearish momentum on daily chart intact while RSI showed signs of rising from near oversold conditions. Resistance at 99.10 (50 DMA, 50% fibo retracement of May high to Sep low), 99.50/70 levels (21, 200 DMAs, 61.8% fibo), 100.6 (76.4% fibo). Support at 98.40/60 levels (100 DMA, 38.2% fibo)."

"Data releases this week include October JOLTS job openings report (Tuesday), employment cost index (Wednesday) and trade (Thursday). Next week has November NFP and CPI reports to be released on 16 and 18 December, respectively. BLS has announced that Oct CPI and PPI reports will not be released."