With no major US data releases amid the government shutdown, markets remain subdued as investors await news on when the delayed September labor report will be published. While tonight’s FOMC minutes may shed light on internal divisions, they are unlikely to move the dollar. Traders remain focused instead on the labor market’s resilience and inflation trends – the factors that will truly shape the Fed’s next steps, Commerzbank's FX analyst Antje Praefcke notes.

FOMC minutes unlikely to shake Dollar amid data void

"Tonight, the minutes of the last FOMC meeting are on the agenda. Some FOMC members have recently expressed caution about further interest rate cuts, such as Chicago Fed President Austan Goolsbee, not least because of the looming effects of tariffs on prices. Newcomer Stephen Miran, on the other hand, continues to maintain his fundamentally dovish stance, although he recently even admitted that he could change it if, for example, a shock to rents led to an inflation forecast that was less benign in his view."

"Will this information move the dollar? I don't think so. After all, the fact that there are sometimes significant differences of opinion within the FOMC is nothing new. Furthermore, Miran's statements show that opinions can change. And ultimately, it is the future that is decisive for the FX market. And here, depending on how inflation develops, but above all on how the labor market continues to perform, will be decisive for the Fed's future course."

"And this brings us back to the shutdown and the labor market report: until we have new information, it makes little sense to react to past statements by FOMC members in the minutes. Apart from the fact that the next two labor market reports are likely to be distorted by the delayed collection of data and the layoffs of government employees, they are still much more important for the dollar than what will be in the minutes tonight. Because, ultimately, that's all old news."