The US Dollar Index, which measures the performance of the US currency against six major currencies, stabilized at 98.178 after falling 0.17% the previous day. After a tough week, the British Pound steadied at $1.3442 in early Asian trading hours.

The dollar declined on Thursday during a volatile week amid bond market tensions and data showing weakness in the US labor market, boosting expectations of an interest rate cut this month.

With the Federal Reserve focusing on the labor market, the key jobs report on Friday will determine near-term interest rate expectations after data on Wednesday showed job openings fell to a 10-month low in July, although layoffs remained relatively low.

The weaker-than-expected job openings data weighed on the dollar.

The euro held onto gains made overnight, trading at $1.165775 in the latest session.

After a tough week, the British Pound stabilized at $1.3442 in early Asian trading hours.

The yen traded at 148.12 against the dollar after making small gains in the previous session.

The US Dollar Index remained steady at 98.178 after a 0.17% decline the previous day.

Several Federal Reserve officials said on Wednesday that labor market concerns still support their view that a rate cut is near.

James Knightley, Chief International Economist at ING, forecast significant rate cuts in the coming months due to limited inflationary pressures from the labor market.

He said, “We expect them to cut rates by 25 basis points at the Federal Open Market Committee meetings in September, October, and December.”

Much attention this week focused on the bond market where long-term bond yields rose globally amid growing investor concerns about the resilience of major economies from Japan to Britain and the US.

However, dovish policymakers’ comments alongside weak labor data boosted Treasury bonds, pushing yields down.

The yield on 30-year US Treasury bonds reached 4.891% after hitting 5% on Wednesday, its highest level in about a month and a half.

The Australian dollar stabilized at 0.6545 US dollars, and the New Zealand dollar traded at 0.5881 US dollars in the latest session.