The US dollar is demonstrating remarkable resilience, despite heightened expectations for an interest rate cut by the Federal Reserve at the September meeting and the ongoing controversy around Fed Board member L. Cook.

Indeed, the situation with the US currency on the Forex market is unusual, especially considering the prospects of lower interest rates and the scandal between President Donald Trump and Fed representative Lisa Cook, whom he "dismissed," but who refuses to obey him. Let's break down this interesting scenario.

Let's start with its resilience in the interbank Foreign Exchange market. In my view, there are two main reasons for this. The first is that any real rate cut is heavily dependent on incoming US economic data, primarily inflation. Fed Chair J. Powell, under intense pressure from Treasury Secretary S. Bessent and President D. Trump—both urging him to lower rates—hinted during his Jackson Hole speech that the key interest rate might be cut by 0.25% at the September meeting. However, as has become typical this year, he made this move conditional on the economic data, especially inflation and labor market reports. With the risk of higher inflation due to new tariff policies, the possibility of a rate cut remains uncertain.

In this environment, traders are not rushing to sell dollars, reasonably believing there is a risk that rates could remain at current levels—albeit a small one, measured at 12.7% by fed funds futures. This keeps them in a wait-and-see mode.

The second reason lies in the basket of major currencies traded against the dollar on Forex, as represented by the ICE Dollar Index. This basket includes the currencies of economically developed countries—traditionally viewed as strong economies, such as the UK, Switzerland, the eurozone, Australia, Japan, and others. All these countries now face serious economic problems, only made worse by new US tariffs and unprecedented obligations to finance the US economy through weapons purchases and massive investments.

Given these countries' weakness and their reliance on the US, the dollar is feeling quite comfortable, showing resilience not only on the ICE Index but also generally in Forex trading.

As for the scandalous behavior between Cook and Trump, it has had little impact on the markets or the dollar, causing only limited pressure.

So, what can we expect from the dollar in the near future?

I think its sideways movement against the major currencies, and in the index itself, will continue until fresh US employment data is published next week and inflation data a little later.

What can we expect from the markets today?

I believe that stock markets will continue to rise—primarily in America, but also in Europe and Asia. Gold prices and crude oil prices are expected to continue moving sideways. As for the cryptocurrency market, the flow of interest into equities due to the high likelihood of rate cuts (and away from crypto) will likely continue, negatively affecting their value against the dollar.

Overall, I see the market picture as moderately positive.

Forecast of the Day:

AUD/USD

The pair is consolidating above 0.6480 as it awaits new US economic data releases scheduled for Friday and next week. It's likely the pair will correct downward toward 0.6420 if it falls below 0.6480. A potential sell level would be at 0.6469.

Gold

Gold prices have been drifting sideways since late April, with the range gradually narrowing amid contradictory US news, the Ukraine conflict, and global tensions. Gold has been unable to rise above $3,400.00, and technically, it could correct down to $3,351.00 after breaking below $3,373.30. A sell level may be at $3,370.80.