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The U.S. dollar slipped on Friday but held within recent ranges against major currencies as traders awaited next week’s Federal Reserve meeting, where policymakers are widely expected to cut interest rates.

The dollar index, which measures the currency against six peers, was down 0.1% at 98.994, not far from Thursday’s five-week low of 98.765. For the week, the index was down 0.5%.

The euro was about flat at $1.16433, not far from Thursday’s three-week high of $1.1681.

Traders are pricing a nearly 90% chance of a Fed rate cut next week, and potentially two more reductions next year, LSEG data showed.

“This week, some soft labor market data releases from alternative sources helped crystallize what still appears to be an overdone 90% probability of a cut next week,” Antonio Ruggiero, FX & macro strategist at Convera, said.

Morgan Stanley said on Friday it now expects the Fed to deliver a quarter-percentage point rate cut in December, joining peers JPMorgan and BofA Global Research, following dovish remarks from central bank policymakers.
All three brokerages previously expected the Fed to hold rates steady in December. “The dollar also continues to look overvalued relative to major peers, with the softer tone therefore fully justified,” Ruggiero said.

Data on Friday that showed U.S. consumer sentiment improved in early December did little to boost the dollar.

Separately, the Personal Consumption Expenditures (PCE) Price Index increased 0.3% in September after gaining 0.3% in August, the BEA said. Excluding the volatile food and energy components, the PCE Price Index gained 0.2% after climbing 0.2% in August, the report delayed by the recent government shutdown showed.

Investors are also weighing the prospect of White House economic adviser Kevin Hassett taking over as Fed chair after Jerome Powell’s term ends in May. Hassett is expected to push for more rate cuts.

The dollar “remains slightly offered on the view that the Fed will cut rates next week and that the arrival of Kevin Hassett as Fed Chair will somehow make the Fed more dovish,” said Chris Turner, global head of markets at ING.

YEN FIRMS

The yen, which has been supported in recent sessions by expectations that the Bank of Japan could raise rates this month, edged up on Friday, rising 0.1% to 155.295 to the dollar.

BOJ officials are ready to raise rates on December 19 in the absence of any major economic shocks, Bloomberg reported on Friday, a day after Reuters reported three sources as saying a hike this month was likely.

“As the funding currency of choice in the carry trade, some unwinding in light of higher JPY rates is poised to boost the yen,” Convera’s Ruggiero said.

Sterling was about flat on the day at $1.3329, not far from the previous session’s six-week peak of $1.3385.

Next week sees a parade of central bank policy decisions, with the Reserve Bank of Australia’s coming on Tuesday, the Bank of Canada’s on Wednesday and the Swiss National Bank’s on Thursday in addition to the Fed’s statement on Wednesday.

That continues the following week with the BOJ, European Central Bank, Bank of England, and Sweden’s Riksbank.

Leading cryptocurrency bitcoin fell for the second straight day, slipping 3% to $89,701.