US Dollar Mixed Early Monday; Focus on FOMC Meeting This Week

07:54 AM EST, 12/08/2025 (MT Newswires) -- The US dollar was mixed against its major trading partners early Monday -- up versus the pound and yen, down versus the euro and Canadian dollar -- as the focus turns to the two-day rate setting Federal Open Market Committee meeting conclusion Wednesday.

The CME's FedWatch Tool currently shows an 89.6% chance being priced in for a 25 basis point rate reduction in the target federal funds rate to 3.50% to 3.75% and a 10.4% chance of no change to the current 3.75% to 4.00% range.

Federal Reserve officials are in their 'quiet period' until after the meeting.

Monday's schedule is light, with only the New York Federal Reserve's inflation expectations reading for November at 11:00 am ET.

Tuesday's highlights include the National Federation of Independent Business' small business sentiment reading for November, weekly Redbook same-store sales and job openings and hiring data for October.

Prior to the FOMC meeting's conclusion, weekly mortgage applications data, the employment cost index for Q3, and weekly oil stocks inventory data are due to be released Wednesday.

Weekly jobless claims and natural gas stocks inventory data and state unemployment data for September are due to be released Thursday, along with delayed international trade and wholesale inventory data.

Friday's schedule is light, with only the St. Louis Fed's gross domestic product Nowcast estimate for Q3 due to be released.

A quick summary of foreign exchange activity heading into Monday:

EUR/USD rose to 1.1648 from 1.1644 at the Friday US close and 1.1646 at the same time Friday morning. Eurozone investor confidence improved in the December reading, but remained below the breakeven point, data released earlier Monday showed. The next European Central Bank meeting is scheduled for Dec. 18.

GBP/USD fell to 1.3316 from 1.3333 at the Friday US close and 1.3341 at the same time Friday morning. UK retail sales conditions data are due to be released at 7:01 pm ET. The next Bank of England meeting is scheduled for Dec. 18.

USD/JPY rose to 155.6401 from 155.3121 at the Friday US close and 155.1932 at the same time Friday morning. Japanese GDP contracted in Q3, while the Japanese current account services narrowed in October and Japanese service business sentiment decline in November, according to data released overnight. The next Bank of Japan meeting is scheduled for Dec. 18-19.

USD/CAD fell to 1.3807 from 1.3830 at the Friday US close and 1.3941 at the same time Friday morning. The Canadian leading index rose at a slower pace in November than in the previous month, data released earlier Monday showed. The next Bank of Canada meeting is scheduled for Wednesday, when no change in the target rate is expected.

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