US Dollar Index probes lows at the 95.00 handle

  • The index came under heavy pressure after US CPI results.
  • DXY suffered as well another bout of comments from Trump.
  • US CPI figures came in below expectations in September.

The greenback stays offered so far this week and the US Dollar Index remains under pressure around the key support at 95.00 the figure.

US Dollar Index weaker on Trump, CPI

The index is prolonging the weekly correction lower and is now flirting with the key down barrier at the 95.00 mark.

DXY lost further ground after US consumer prices rose less than initially forecasted during September. In fact, tracked by the CPI, headline prices and Core prices rose 0.1% MoM and 2.3% and 2.1%, respectively, over the last twelve months.

On this matter, Senior Market Analyst at FXStreet Joseph Trevisani noted: “The Fed is not pursuing inflation, it is not seeking to damp an overheating economy. It is chasing a 'normal' rate environment and will continue to do so as long as economic growth holds up”.  

Further selling pressure hit the buck after President Trump has once again criticized the Federal Reserve for its current monetary policy tightening, saying that ‘the Fed and treasuries are the problem, not the trade war and China’.

On the latter, President Trump is expected to meet China’s Xi Jinping at the G20 meeting in November.

US Dollar Index relevant levels

As of writing the index is losing 0.24% at 95.29 and faces immediate support at 94.98 (low Oct.11) seconded by 94.95 (21-day SMA) and then 94.20 (38.2% Fibo of the 2017-2018 drop). On the upside, a breakout of 96.16 (high Oct.9) would open the door to 96.98 (2018 high Aug.13) and finally 97.87 (61.8% Fibo retracement of the 2017-2018 drop).

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