Dollar Hangs in Balance as Inflation Report Looms

The US dollar is in a precarious position ahead of the Consumer Price Index (CPI) release, which will determine whether it continues to soften or recovers its support.

Last week's payrolls report weakened the case for aggressive Federal Reserve tightening, especially after the negative headline print and large downward revisions.

However, the unemployment rate fell to 4.1%, and slower labor-force growth means the economy may need fewer jobs than usual to keep unemployment steady.