The US Dollar Index (DXY0 – which tracks the greenback vs. a basket of its main rivals – seems to have recovered the smile today and is now moving higher to the 93.40 region, or session tops.
US Dollar focus on CPI
After two consecutive sessions with losses, the index has managed to regain some buying interest and is now pushing higher towards the area of 93.40 following the opening bell in Europe.
The buck shrugged off poor results from US producer prices in July (Thursday) as well as the dovish (at least not hawkish) message from NY Fed W.Dudley yesterday.
Dudley believes that inflation could start to pick up pace in the medium term, although at the same time he ruled out that the Fed could achieve its inflation goal this year. Dudley expects that a weaker Dollar plus a tight labour market should start putting upside pressure on inflation soon.
He also added, “We’re not going to get to a year-over-year number of 2% until some of these very low readings drop out of the statistics six to ten months from now”.
In the data space, key July’s inflation figures tracked by the CPI are due next, with analysts at Danske Bank arguing “Although the Fed continues to believe the tighter labour market will eventually drive inflation up and the US dollar has recently depreciated sharply, these are both effects that take a long time to work their way into the CPI numbers”.
In addition, Dallas Fed r.kaplan (voter, hawkish) and Minneapolis Fed N.Kashkari (voter, dovish) are also due to speak.
US Dollar relevant levels
The index is gaining 0.11% at 93.40 and a break above 93.77 (high Aug.8/9) would aim for 94.11 (high Jul.26) and finally 95.10 (23.6% Fibo of the 2017 drop). On the flip side, the next support lines up at 93.14 (10-day sma) seconded by 93.12 (low Aug.8) and finally 92.39 (2017 low Aug.2).
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. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
USD/JPY holds positive ground around 151.50 following Japanese CPI data
The USD/JPY pair holds positive ground for the second consecutive day near 151.45 on Friday during the early Asian trading hours. The cautious approach from the Bank of Japan to keep monetary conditions accommodative exerts some selling pressure on the Japanese Yen.
AUD/USD holds above 0.6500 in thin trading
The Australian Dollar managed to recover ground against its American rival after AUD/USD fell to 0.6484. The upbeat tone of Wall Street underpinned the Aussie despite broad US Dollar strength and tepid Australian data.
Gold price finishes Thursday’s session set to reach new all-time highs
Gold price rallied during the North American session on Thursday and hit a new all-time high of $2,225 in the mid-North American session. Precious metal prices are trending higher even though US Treasury yields are advancing, underpinning the Greenback.
Top 3 Price Prediction BTC, ETH, XRP: Retail watches from the sidelines with a bias for shorts
Bitcoin is showing strength as markets head into the Easter holidays. As it rises, altcoins are following suit, with Ethereum and Ripple posting almost similar gains. Meanwhile, there remains an unfilled CME Gap, with a lot of liquidity also resting above and below BTC price.
Bears have been standing before a steamroller so far this year
Despite a pushback on rate cuts from Christopher Waller, and what was supposed to be cautious trading sentiment ahead of critical US inflation data released later on Friday, the S&P 500 rose on Thursday, marking its best first-quarter performance in five years.