Dollar mostly flat as softer US data fuel dovish rate bets

On Tuesday, the U.S. dollar remained relatively stable against other major currencies as investors anticipated a more cautious stance from the Federal Reserve following weaker economic data. The euro dipped slightly from a two-month high of $1.161 to $1.1587, while the dollar gained 0.15% against the Swiss franc, reaching 0.812.

Sterling also saw a modest rise against the dollar, reaching $1.35420. Analysts attributed the dollar's relatively flat performance to the market's interpretation of a dovish response from the Fed in light of recent economic data, including unexpected job losses and muted inflation readings. This shift in market sentiment has led to a near-70% chance of a rate hold in the September quarter-point hike, down from previous expectations.

The dollar's stability comes amid ongoing concerns about inflation, the potential for further Iranian conflict, and the impact of joint U.S.-Japanese intervention on the yen.