US Dollar Index Trims Gains as Fed Rate Hike Bets Fade

The US Dollar Index (DXY) pulled back from its initial strength at the start of the week. The index opened on a firmer note but later trimmed those gains.

Market participants are holding off on fresh directional bets until there is more certainty about the Federal Reserve's next policy moves. Diminishing expectations for further rate hikes are capping the dollar's upside.

The index's movement reflects a cautious tone in currency markets ahead of key economic data and Fed commentary.