Dollar index lingers below 98 mark; US non-farms eyed for further cues

The dollar index is lingering below the 98 mark on Tuesday amid growing expectations of a Federal rate cut that is pushing dollar lower. The dollar index that measures the greenback against a basket of currencies is trading at 97.92 while US benchmark treasury yields are staying flat near 4.2%. Focus now shifts to this week’s US nonfarm payrolls report, which could influence the Fed's rate decision. Also, US ISM manufacturing PMI for August will be in the spotlight later today. The slight rebound in the greenback can be attributed to safe haven demand amid ongoing geopolitical tensions between Russia and Ukraine. Ukrainian President Volodymyr Zelenskyy has reportedly vowed to retaliate by ordering more strikes deep inside Russia. Meanwhile, US dollar index speculators continue to increase their net short position, according to the latest Commitment of Traders (COT) data. The non-commercial futures contracts of US dollar index futures, traded by large speculators and hedge funds, totaled a net short position of 6105 contracts in the data reported through August 26, 2025, showing a marginal increase of 117 net positions compared to the previous week. The net speculative shorts are at their highest in around four and half years.