The dollar fell on Wednesday, with investors expecting a raise in US interest rates later in the day, but wondering how long the Federal Reserve will keep policy tight in light of the latest bleak employment data, as well as concerns over the US debt ceiling and the banking sector.

Job vacancies in the United States declined for the third month in a row in March, while layoffs reached their greatest level in more than two years, according to statistics released on Tuesday, raising hopes that the labor market’s weakening may boost the Federal Reserve’s fight against inflation.

The dollar index , which measures the U.S. currency against six rivals, fell 0.128% to 101.710, after sliding 0.245% on Tuesday.

The Fed is widely expected to raise interest rates by 25 basis points when it concludes a two-day meeting on Wednesday and investor focus will be on whether the Fed hints at a pause or further tightening.

Bank of Singapore currency strategist Moh Siong Sim said markets are expecting rate cuts towards the end of the year due to the stress in the U.S. banking system. But, Moh reckoned the Fed might seek to downplay the prospect for lower rates as data is showing that while “the U.S. economy is slowing, it is not slowing fast enough to bring inflation back to the 2% target.”