The US dollar is falling for the fourth consecutive day, heading toward its worst week since July. The market is displaying a rare sense of relief because the Federal Reserve seems to have decided to take a breather. The Bloomberg Dollar Spot Index is down half a percent, and the two-year Treasury yield has dropped to its lowest level in six weeks.

Traders are now confident that a series of rate cuts is around the corner. Last Wednesday, markets were pricing in a 46-basis-point rate cut by the year end, but a few days later, they raised the forecast to 53 percentage points.

Federal Reserve Governor Christopher Waller said recently that the central bank could lower interest rates by steps of 25 basis points to support a labor market that looks increasingly unstable. His colleague, Stephen Miran, however, believes that the time for decisive monetary easing has not come yet.

Despite the government shutdown and the pause in macroeconomic data releases, the market does not look confused. On the contrary, participants express a firmly bearish sentiment on the US dollar. Morgan Stanley economists, led by Michael Gapen, note that “the lack of data isn’t preventing the Fed from moving toward easing” and expect another rate cut at the October meeting.

US regional banks are once again under the spotlight, painting a gloomy picture. Their stocks are falling, undermining the market’s confidence in the resilience of the credit sector. Cooling political tensions in Japan and France are another catalyst for the greenback’s weakness. All in all, there is a rare situation: the dollar is unable to assert its strength.

ING analysts Christopher Turner and Francesco Pesole note that the US dollar is facing pressure from all sides — from a “reassessment” of the Federal Reserve’s policy and falling oil prices to fragile hopes for peace in Ukraine and the ever-simmering US-China rivalry.

Meanwhile, weary indifference has settled in the market: everyone knows the dollar is struggling, but no one dares to say where the bottom might be.