US Dollar Index tumbles below 103.00 amid risk-on mood, FOMC Minutes eyed
|- DXY reverses Friday’s corrective pullback from two-week low.
- Repeated Fedspeak, firmer sentiment weigh on the greenback.
- Recovery in Treasury yields fails to probe the bears as stock futures rise over 1.0%.
- Monthly PMIs, FOMC Minutes will be crucial for fresh impulses.
US Dollar Index (DXY) takes offers to refresh its intraday low near 102.75, fading the previous day’s rebound from a fortnight low during Monday’s Asian session.
The greenback gauge flashed the biggest weekly loss since January, not to forget snapping a six-week uptrend, as the market’s risk-on mood joins the repeated comments from the US Federal Reserve (Fed) officials.
The firmer mood could be linked to improving covid conditions in China, recently mixed data from the US and expectations that the global leaders will be able to tackle the growth fears with coordinated measures. A reduction in China’s covid numbers and an absence of historic US statistics join optimism by the major policymakers ahead of this week’s Quad Summit in Tokyo to favor a risk-on mood.
On the contrary, escalating fears of the Russia-Ukraine crisis and the divide between the West and Moscow seem to keep the DXY bulls hopeful.
That said, The DXY weakness ignores recently firmer US Treasury yields, up to three bps around 2.81% by the press time, by justifying the 1.0% gain of the S&P 500 Futures.
Moving on, preliminary prints of May month’s PMIs and Minutes of the latest Federal Open Market Committee (FOMC) will be crucial for clear directions. Risk catalysts, however, can offer intraday directions.
Technical analysis
Sustained trading below the 21-day EMA, around 103.00 by the press time, directs DXY towards the monthly low surrounding 102.30.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.