US dollar weakens on expectations that Fed will slow pace of coming interest rate hikes

The dollar is declining after Federal Reserve Chairman Jerome Powell’s speech. He confirmed Wednesday that the Federal Open Market Committee (FOMC) might scale back the pace of the interest rate hikes at its December meeting. 

Speaking at the Brookings Institution in Washington, Powell highlighted that such a decision would allow them to balance risks. 

Joe Perry, senior market analyst at FOREX.COM in New York, commented on the Fed Chairman's speech. As reported by him, Powell clearly signaled that the FOMC would opt for smaller increases. He believes that stocks rose and the dollar began to weaken amid these comments.

The Federal Reserve is expected to downshift in December to deliver a 50-basis-point interest rate hike at its December 13-14 policy meeting.

The ADP jobs report also pushed the US dollar lower. The data showed that private sector employment increased much less than expected in November. According to the other data, the number of available jobs in the US in October dropped.