- The index fades initial gains and is now testing daily lows.
- US Producer Prices surprised to the upside in May.
- FOMC to deliver 25 bp hike, investors focused on ‘dots plot’.
The US Dollar Index (DXY), which measures the buck vs. a basket of its main competitors, is now trading on the defensive in the lower bound of the daily range near 93.70.
US Dollar all the attention on the Fed
The index has lost some upside momentum, coming down to the 93.70 region after flirting with the proximity of the 94.00 barrier earlier in the day.
Previously in the US docket, the greenback paid little-to-nil attention to the auspicious prints from US Producer Prices, advancing above expectations 0.5% MoM and 3.1% on a year to May.
Further out, the move lower in DXY echoes the correction in yields of the US 10-year benchmark to the 2.95% region from yesterday’s tops around 2.98%.
Later in the NA session, investors have largely anticipated a 25 bp rate hike by the Federal Reserve at its meeting, although the update of the ‘dots-plot’ will also be under scrutiny.
US Dollar relevant levels
As of writing the index is losing 0.16% at 93.69 and a breakdown of 93.22 (low Jun.7) would aim for 92.80 (38.2% Fibo of the April-June up move) and then 92.24 (low May 13). On the other direction, the next hurdle is located at 94.00 (psychological level) followed by 94.32 (high Jun.4) and finally 94.45 (high May 31).
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.