- Dealers are chasing safe ports such as gold for fresh high times in front of mutual tariffs.
- Markets see us PCE and the University of Michigan Numbers release, which adds equity.
- The US dollar index breaks below 104.00, no safe port stream in greenback.
The US Dollar Index (DXY), which tracks the performance of the US Dollar (USD) against six major currencies, is currently set to close this Friday in a loss of 103.90 at the time of writing on Friday. Dealers don’t really look at Greenback, but rather on a 2nd Mosquito from stocks and Cryptocurrencies to Precious Metals’ market, where gold has hit another highest high this Friday for $ 3,086. The mutual duty deadline is approaching quickly, April 2, and has clearly hit a nerve among dealers and market participants.
On the economic data front, all eyes of the Federal Reserve (FED) were preferred inflation monitor, US personal consumption expenses (PCE) data for February. Some big beats or surprises. Later this Friday, Bold Vice President Michael Barr and Atlanta Fed -President Raphael Bostic is still going to talk.
Daily Digest Market Movers: right in front of next week
- The US Personal Consumption Expenditure Data for February has been released:
- The monthly heading PCE came at 0.3% as expected, unchanged from the previous 0.3%. The annual meter remained stable at 2.5%.
- The monthly core PCE grew by 0.4% and beat the expected 0.3%. The annual core PCE crossed up to 2.8% from 2.6%.
- At the same time, US personal income monthly to month for February jumped to 0.8%, a large rate of the expected 0.4% and from 0.9% earlier. The US personal expenses for February fell to 0.4%below the expected 0.5%coming from the previous contraction of 0.2%.
- The University of Michigan Consumer Sentiment Index Reading for March Cames in Softer at 57, is missing the estimate of 57.9 and previous reading. The 5-year consumer inflation expectations increased to 4.1% from 3.9% earlier.
- At. 16:15 GMT will Federal Reserve Bank Vice President of Monitoring Michael Barr talk about banking policy at 2025 Banking Institute in Charlotte, NC
- At. 19:30 GMT will the Federal Reserve Bank of Atlanta President Raphael Bostic moderate a political panel on the third annual Georgia Tech Atlanta Fed Household Funding Conference at Atlanta Fed, Atlanta, Georgia.
- Shares dive lower at losses between 0.5% to 2% crossing from Asia over Europe and into us futures.
- According to the CME Fedwatch tool, the probability of interest is left in the current range of 4.25%-4.50%in May’s meeting 87.1%. For June meeting, the odds of borrowing costs were lower at 65.5%.
- The US 10-year dividend deals about 4.28%looking for direction with a slight safe harbor inflow.
US Dollar Index Technical Analysis: There is the track
The US Dollar Index (DXY) has grossly consolidated since the seismic fall in early March. Slowly but surely, some small settlement of the big move that is lower begins to unfold. Look for a synchronized feature, with Gold Paring Spring Gains and the speed difference between the United States and other countries that are being expanded again for a comeback of DXY to 105.00/106.00.
With the weekly closure over 104.00 last week, a return to 105.00 round level could still occur in the coming days, with the 200-day simple sliding average (SMA) converting at that time and amplifying this area as a strong resistance of 104.95. Once broken through this zone, a number of key levels, such as 105.53 and 105.89, could limit the upward momentum.
On the disadvantage, 104.00 round level is the first nearby support after a successful jump on Tuesday. If this level does not last, the DXY risk risks falling back in March between 104.00 and 103.00. When the lower end at 103.00 gives space, fit 101.90 on the downside.
US Dollar Index: Daily Chart
Fed Frequent Frequently Asked Questions
Monetary policy in the United States is shaped by the Federal Reserve (Fed). Fed has two mandates: to achieve price stability and create full employment. Its primary tool to achieve these goals is by adjusting interest rates. When prices rise too fast and inflation is over Fed’s target of 2%, it raises interest rates and increases borrowing costs throughout the economy. This results in a stronger US dollar (USD) as it makes the United States a more attractive place for international investors to park their money. When inflation falls to below 2%or unemployment is too high, Fed may be able to lower interest rates to encourage borrowing, which weighs on greenback.
The Federal Reserve (Fed) holds eight political meetings a year, with the Federal Open Market Committee (FOMC) assessing financial conditions and making monetary policy decisions. FOMC participates in twelve bold officials seven members of the board, the president of the Federal Reserve Bank of New York and four of the remaining eleven regional reserve bank presidents earning a one-year election on a rotating basis.
In extreme situations, the Federal Reserve may resort to a policy called Quantitative Easing (QE). QE is the process of essentially increasing the flow of credit in a fixed financial system. It is a non-standard political measure used during crises or when inflation is extremely low. It was Fed’s chosen weapons during the big financial crisis in 2008. It involves the Fed -Printing of several dollars and use of them to buy high quality bonds from financial institutions. Qe usually weakens the US dollar.
Quantitative tightening (QT) is the opposite process for QE, whereby the Federal Reserve stops buying bonds from financial institutions and does not reinvest the principal from the bonds it has matured to buy new bonds. It is usually positive for the value of the US dollar.