The U.S. Dollar Index (DXY) remains resilient at 108.93, down just 0.1%, as market participants digest potential Federal Reserve rate cuts in the first half of 2025, according to Morgan Stanley's latest Global Macro Commentary. Fed Governor Waller's comments that "it is reasonable" to expect rate cuts if data continue to cooperate have sparked a rally in U.S. Treasury yields, with the 10-year yield at 4.613%, down 4.1 basis points. Despite mixed U.S. retail sales data, which showed a 0.4% m/m increase in December, the control group sales rose 0.7% m/m, supporting a 3.2% growth in 4Q24 real consumption. Morgan Stanley analysts highlight that the DXY's downside is limited by these evolving economic dynamics and the Fed's dovish stance, suggesting a more balanced risk profile for the dollar.