Dollar Sinks to R$5.45 as U.S. Jobs Data and Fed Hints Shift Market Focus

The dollar fell to R$5.45 on Wednesday after weaker U.S. job data and signals from Federal Reserve officials suggested a likely rate cut.

Official data published on September 4 show the U.S. Jolts report registered just 7.18 million job openings versus 7.37 million forecast, disappointing expectations and setting the stage for more dovish monetary policy in the coming weeks.

Both Fed Governor Christopher Waller and Atlanta Fed President Raphael Bostic stated in interviews that weaker labor figures justify a potential 0.25 percentage point rate cut as soon as mid-September.

The CME FedWatch Tool placed the odds near 95% for this outcome, up from the day before. The dollar index (DXY), which benchmarks the greenback against a basket of global currencies, dropped 0.21% to 98.183 during afternoon trading.

These developments quickly pressured the dollar lower, triggering its first decline after three straight days of gains. In Brazil, the real received modest domestic support despite news from the National Statistics Bureau that industrial output shrank 0.2% in July from the month before.

Market reaction to this figure was muted, as global developments largely shaped the day’s trade. Ongoing political tension also influenced sentiment, with the Supreme Federal Court continuing hearings regarding former President Bolsonaro and recent trade sanctions.

Technical analysis reveals a narrowing range for USDBRL. The daily chart indicates price hovering near key moving averages, facing overhead resistance close to 5.48 and support just above 5.43. Bollinger Bands contracted, flagging reduced volatility.

The MACD, a momentum indicator, flashed early reversal signs though still shy of a robust bullish shift. RSI settled at 48.48, squarely in neutral territory, and confirmed the absence of short-term extremes.

The distinctive yellow Global Liquidity Index on the chart tracked sideways throughout the session, echoing global risk conditions and failing to provide impetus.

Medium-term moving averages, including the 50 and 100-day lines, trended slightly downward, paralleling the low conviction phase visible in momentum and volatility metrics.

Traders observed that volume and price lacked synchrony, signaling limited conviction by market participants during the session.

No notable Fibonacci retracement or breakout zones appeared. Resistance just beneath 5.50 persisted, while support around 5.43 stabilized.

In the last 24 hours, fundamental and technical factors converged to drive the real’s appreciation. The weakest U.S. job opening data since early 2023 and clear Fed guidance on forthcoming monetary policy changes shifted capital flows decisively.

As a result, the dollar’s retreat signaled markets now demand firmer signals from the Federal Reserve and clearer data from Brazil to change its short-term path.

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