The dollar weakened in Asian trading on Monday as traders increasingly bet on the Federal Reserve cutting interest rates by 50 basis points this week. The dollar's decline boosted major currencies such as the yen, which rose to its highest level since July 2023. Traders are favouring the latter option after weeks of debate over whether the Fed will kick-start its easing by cutting rates by 25 basis points or 50 basis points. Futures prices linked to the Fed's decision to cut rates this week put the probability of a 50 basis point cut at about 58 per cent, compared with a 50-50 split forecast late on Friday. Rodrigo Catril, strategist at National Australia Bank, said: "We think the Fed is about to enter a new easing cycle, which is a big headwind for the dollar. As the Fed eases monetary policy next year and moves the funds rate to neutral or even below neutral, the dollar will start to decline cyclically." (Golden Ten)