- DXY Index demonstrates slight losses yet sustains near early November highs.
- The downward movements may be seen as buyers running out of momentum.
- Hawkish bets on the Fed and a sour market mood may limit the losses.
The US Dollar Index (DXY) is currently trading at 106.09, a mild loss from its recent peak of 106.35. Despite this, the index remains geared toward testing its November 1 high of 107.10. However, the outlook for the Greenback remains positive as Middle East tensions and hawkish bets on the Federal Reserve (Fed) may drive demand back to the USD.
The US economy exhibits robust growth with persistent inflation, which made the Fed change its messaging to a more hawkish one, triggering a rally of US Treasury yields and hence benefiting the US Dollar.
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