Several Fed officials — including Powell — cited the Beige Book as one of their reasons for cutting 50 basis points in September. There is a belief at the Fed that anecdotal data is often better at capturing turning points than hard numbers, particularly in lagging data like employment.

The September Beige Book was dour but it was starting to look like a one-off in light of stronger economic data but today’s report read even more downbeat. The report showed economic activity was “little changed in nearly all Districts” compared to August’s report which had three Districts showing growth and nine showing flat/declining activity. It also said employment growth moderated further, with hiring now “focused primarily on replacement rather than growth”

Those comments got the markets attention and helped to solidify the belief that another 25 bps cut is coming in November and a high chance of one in December. The turn in the dollar was across the board afterwards, with the cable chart shown here representative of the broader USD move.