US Dollar Index establishes below 98.00, subdued GDP and ADP Payrolls renew worries
- The DXY has plunged below 98.00 after a weak performance from the US GDP and ADP Payrolls.
- Risk-on impulse has diminished the appeal of safe-haven assets.
- The US NFP and Russia-Ukraine peace talks are major events this week.
The US dollar index (DXY) is facing the heat of subdued performance from the US economic indicators and rising demand for risk-sensitive assets after a constructive outcome from the first face-to-face Russia-Ukraine peace talks between their respective officials in Turkey. The mighty greenback-based index has plunged below 98.00, which has acted as a major cushion in the past few weeks.
US GDP and ADP Employment Change
The subdued performance from the US economic indicators on Wednesday has brought an intense sell-off in the mighty dollar. The US Bureau of Economic Analysis reported Gross Domestic Product (GDP) (Q4) growth on an annualized basis at 6.9%, slightly lower than the estimates and previous print of 7%. While the Automatic Data Processing (ADP) recorded Employment Change at 455k lower than the market consensus of 450k and earlier print of 486k.
The constructive outcome of the Russia-Ukraine peace talks
A cut-off in Russian troops in northern Ukraine and the capital Kyiv after the negotiations between Russia and Ukraine has underpinned the positive market sentiment. Risk-perceived assets are gaining traction amid an upbeat market tone as investors have considered the event as a positive step toward a ceasefire. While Ukraine has proposed an adaptation of a neutral status amid abstaining from alliances. The nations will resume their peace talks on April 1 via the web.
Key events this week: Core Personal Consumption Expenditure, Initial Jobless Claims, Nonfarm Payrolls (NFP), Unemployment Rate, and ISM Manufacturing PMI.
Eminent issues on the back boiler: Russia-Ukraine Peace Talks, OPEC Meeting, Fed President John C. Williams speech.
Author
Sagar Dua
FXStreet
Sagar Dua is associated with the financial markets from his college days. Along with pursuing post-graduation in Commerce in 2014, he started his markets training with chart analysis.
