DXY Corrects Lower After Fed Hike Bets Trimmed

The US Dollar Index (DXY) has been trading near its two-month high of 101.64, but recent data suggests it may be due for a correction.

The DXY is currently down 0.11% to near 101.28, and traders have trimmed their bets on a Federal Reserve interest rate hike in October after New York Fed Governor John Williams commented that 'there is no need for urgency after September's rate hike.'

Williams added that 'more data will help the Fed decide what's next for rate policy,' hinting at potential further tightening if inflation remains high.

The CME FedWatch tool shows the odds of a Fed interest rate hike in October have decreased to 44.8% from 70.9% on Monday.