- DXY returns to the sub-98.00 region on Thursday.
- FOMC minutes stressed the Fed’s ‘wait-and-see’ stance.
- Philly Fed index, Claims, Fedspeak next on the docket.
The greenback, when tracked by the US Dollar Index (DXY), is struggling for direction in the proximity of 97.90 on Thursday.
US Dollar Index focused on trade, docket
The index is alternating gains with losses in the second half of the week around the 97.90 region, coming under some selling pressure after being rejected from weekly tops beyond 98.00 the figure on Wednesday.
As always, the greenback keeps tracking the headlines from the US-China trade dispute. In this regard, investors’ sentiment took a hit on Wednesday after news suggested that the ‘Phase One’ deal could not be ready this year.
On another front, the FOMC minutes published on Wednesday reinforced the current ‘on hold’ stance from the Federal Reserve, while the Committee also highlighted the solid health of the labour market and reiterated that inflation remains close to the symmetric target.
Later today, the Philly Fed manufacturing gauge will be in the limelight seconded by usual weekly Claims and speeches by Cleveland Fed L.Mester (2020 voter, hawkish) and N.Kashkari (2020 voter, dovish).
What to look for around USD
The index seems to have met solid contention in the 97.70 region for the time being. In the meantime, headlines from the US-China trade dispute are expected to remain as the exclusive driver when comes to price action in the global markets, while investors keep monitoring US fundamentals amidst the ‘wait-and-see’ stance from the Federal Reserve and the steepening of the 2y-10y yield curve seen as of late. Moving to US politics, markets keep ignoring developments from the Trump’s impeachment process, while the impact on the FX space remains muted so far. On the broader view, however, the outlook on the greenback still looks constructive on the back of the Fed’s ‘wait-and-see’ mode vs. the dovish stance from its G10 peers, the dollar’s safe haven appeal and the status of ‘global reserve currency’.
US Dollar Index relevant levels
At the moment, the pair is gaining 0.01% at 97.88 a breakout of 98.45 (monthly high Nov.13) would open the door to 99.25 (high Oct.8) and then 99.67 (2019 high Oct.1). On the other hand, immediate contention is located at 97.68 (monthly low Nov.18) seconded by 97.56 (200-day SMA) and finally 97.11 (monthly low Nov.1).
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
EUR/USD regains traction, recovers above 1.0700
EUR/USD regained its traction and turned positive on the day above 1.0700 in the American session. The US Dollar struggles to preserve its strength after the data from the US showed that the economy grew at a softer pace than expected in Q1.
GBP/USD returns to 1.2500 area in volatile session
GBP/USD reversed its direction and recovered to 1.2500 after falling to the 1.2450 area earlier in the day. Although markets remain risk-averse, the US Dollar struggles to find demand following the disappointing GDP data.
Gold holds around $2,330 after dismal US data
Gold fell below $2,320 in the early American session as US yields shot higher after the data showed a significant increase in the US GDP price deflator in Q1. With safe-haven flows dominating the markets, however, XAU/USD reversed its direction and rose above $2,340.
XRP extends its decline, crypto experts comment on Ripple stablecoin and benefits for XRP Ledger
Ripple extends decline to $0.52 on Thursday, wipes out weekly gains. Crypto expert asks Ripple CTO how the stablecoin will benefit the XRP Ledger and native token XRP.
After the US close, it’s the Tokyo CPI
After the US close, it’s the Tokyo CPI, a reliable indicator of the national number and then the BoJ policy announcement. Tokyo CPI ex food and energy in Japan was a rise to 2.90% in March from 2.50%.