Dollar Defies Fed Doubts Ahead of US Jobs Report

The US dollar has been firming up ahead of today's US employment report, defying expectations that it would soften after recent comments from Fed officials.

Despite Vice Chair of the FOMC (Williams) and Vice Chair of the Federal Reserve Board (Jefferson) suggesting a lack of urgency in raising interest rates, markets had been pricing in a 70% chance of a hike later this month. This probability has since dropped to about 25%, a trimming that has occurred for four consecutive sessions.

The resilience of the greenback is notable, particularly against the Japan yen and Swiss franc which are 0.30%-0.40% higher. The US two-year yield has also been affected, with rates still pricing in a hike later this month.