Home›Forex›Major Pairs›Dollar Index rebounds after Fed hike worries

Dollar Index rebounds after Fed hike worries

The DXY rose 0.27% to about 100.23 after falling to a six-week low near 99.85, but remains below the 20-day EMA at 100.87.

Reported · Written up by our desk · Major Pairs

The US Dollar Index (DXY), which tracks the greenback against six major currencies, is attempting to snap a three-day losing streak on Friday. In European trade, the index was up 0.27% to around 100.23 after hitting a fresh six-week low near 99.85, according to FXStreet.

FXStreet pointed to recent market worries that the Federal Reserve may not raise interest rates further even as inflation stays well above the Fed’s 2% target. Analysts at ING said the FOMC press conference message was “a little confusing,” but that investors interpreted it as the Fed being less tough on inflation than initially thought and potentially relying more on market-driven tightening rather than additional hikes.

Before the Fed decision, the outlet noted that President Donald Trump had told Fed Chair Kevin Warsh to lower interest rates and cited a recent inflation report and expectations that prices would fall once the Gulf War ends. The Fed held rates unchanged at 3.50% to 3.75% and said it is committed to bringing inflation down, while adding it will act if needed.

On FXStreet’s technical read, the Dollar Index spot is trading around 100.20 but keeps a bearish near-term tone by staying below the 20-day EMA at 100.87. The outlet also highlighted that the double-top breakdown near 100.40 and an RSI around 41 point to fading downside momentum without a clear recovery, with resistance seen around the July 15 low at 100.35.

Latest closeDollar index 99.80 ▼0.2%

More like this

Sources