USD weakens as Lululemon cuts guidance citing macro headwinds

The US dollar faced selling pressure following Lululemon's 18% stock plunge after the company cut guidance, citing a 'dynamic macroenvironment'. Despite these concerns, broader market sentiment remained positive with the S&P 500 gaining 1.2%. The disconnect between equity strength and corporate warnings suggests selective market interpretation of economic signals. Currency markets have adjusted Fed rate cut expectations, trimming approximately 8 basis points of anticipated easing following the recent non-farm payrolls report. This reduction in rate cut bets typically supports the dollar, yet the currency struggled to gain traction. The mixed signals from consumer discretionary weakness versus equity market strength create uncertainty for USD positioning. Traders are closely monitoring consumer spending patterns across the US, Canada, and China for further directional cues on dollar strength.