- The DXY dollar index strengthens its progress and exceeded the level of 92.00.
- The US stock market is falling by two-week lows.
- Yields on US 10-year bonds still remain around 1.50%.
The distortion of the supply in the dollar continues, but its severity has receded and is now growing dollar index The US (DXY) reached new highs in two months near 92.30.
The US dollar index is growing despite stable yields
The index on Friday extends its strong recovery above the 92.00 handles, and at the same time reaches new highs, despite the absence of direction in yields in the US.
In fact, the returns are floating bond The ten-year benchmark in the USA is in the consolidation range around the level of 1.50%.
The dollar gained momentum after St. Louis Fed Bullard somehow justified the recent hawkish report of the Federal Reserve System. He also favored ending mortgage bond purchases, indicating an increase in interest rates by the end of 2022.
Factors affecting the US dollar
The index has moved above 92.00 as investors continue to adjust to the latest hawk announcement from the Federal Open Market Committee at its Wednesday meeting. The possibility that the narrowing talks will start earlier than anyone expected, and the vision of high speed in 2023, sparks a sharp recovery in the dollar to the levels last seen in mid-April. However, an unchanged view of the “temporary” rise in inflation, and thus the continuation of the dove’s stance on the part of the Fed, has the potential to dampen the current dynamics of the dollar. A permanent break above the 200-day SMA would have a more positive outlook for the dollar.
Notable problems in the background: Biden’s plans to support infrastructure and families cost nearly $ 6 trillion. US-China trade conflict under Biden’s administration. Reducing speculation versus economic recovery. prices Real interest in the USA versus Europe. Could the US fiscal stimulus lead to overheating?
Levels relevant to the US dollar index
Now the index rose 0.37% to 92.23 and a break of 92.28 (monthly high on June 18) will open the door 92.46 (23.6% Fibonacci retracement in 2020-2021 low) and finally 93.43 (2021 high on March 21). On the other hand, there is additional support at 89.53 (monthly low on 25 May), followed by 89.20 (minimum 2021 on 6 January), then 88.94 (monthly low in March 2018).