US Dollar Index slides further to test monthly lows
|The US dollar is falling on Thursday across the board. US economic data weakened the greenback that extended weekly losses.
The US Dollar Index is down 0.57%, losing ground for the second day in-a-row. It moved toward a key short-term support. The main driver of dollar’s weakness was US data. The Producer Price Index fell 0.1% in December, against expectations of a modest increase. The core PPI dropped by the same amount and the annual rate fell from 2.4% to 2.3%.
Another factor that added to the slide of the DXY was the rally of the euro. Earlier today, the minutes from the latest meeting of the European Central Bank revealed that a revision in the guidance could be considered in early 2018. EUR/USD jumped from 1.1950 to 1.2050.
As greenback falls, crude oil is at 3-year highs and the Dow Jones at new all-time-highs. US yields are up for the day but still under yesterday’s multi-month highs.
Levels to watch
US Dollar Index (spot) bottomed after the beginning of trading in Wall Street at 91.79, the lowest level since last Friday. The 91.75/80 region is a key short-term support that capped the downside several times in January. A break lower could open the door to more losses. The next support levels might be seen at 91.60 (Sep 15 low) and 91.40. On the upside, resistance levels could be seen at 92.00, 92.27 (Asian session low) and 92.55 (daily high).
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