The US dollar index traded around 102 on Friday after declining in the previous session, underperforming other safe-haven assets such as government bonds and precious metals following the recent selloff in technology and artificial intelligence stocks. Markets are increasingly factoring in a potential slowdown in the AI capital expenditure boom, which has been a key driver of the US economy and financial markets. Meanwhile, investors continued to assess the Federal Reserve’s monetary policy outlook, as stronger-than-expected US economic data reinforced expectations of further interest rate hikes. Markets are currently pricing in approximately a 72% probability that the Fed will keep rates unchanged this month, while the likelihood of a December rate hike has risen to 92%. Cleveland Fed President Beth Hammack warned that the central bank might need to raise interest rates more aggressively if public inflation expectations deteriorate significantly.