The dollar index (DXY00) on Monday rose by +0.09%.  The dollar shook off early losses on Monday and moved higher due to a jump in T-note yields, which strengthened the dollar’s interest rate differentials.  The dollar’s near-term upside is limited amid expectations that the Fed will cut the federal funds target range by 25 bp at the conclusion of the Tue/Wed FOMC meeting. Also, strength in EUR/USD on Monday weighed on the dollar due to hawkish ECB comments. President Trump said last that he will announce ...

The dollar index (DXY00) today is up by +0.11%.  The dollar shook off early losses today and moved higher to a jump in T-note yields, which strengthened the dollar’s interest rate differentials.  The dollar’s near-term upside is limited amid expectations that the Fed will cut the federal funds target range by 25 bp at the conclusion of the Tue/Wed FOMC meeting. Also, strength in EUR/USD today is weighing on the dollar due to hawkish ECB comments. President Trump said last that he will announce his selecti ...

The dollar index (DXY00) on Wednesday fell by -0.50% and posted a 5-week low.  The dollar was undercut by Wednesday’s weak Nov ADP report, which was dovish for Fed policy and cemented expectations for a Fed rate cut at next week’s FOMC meeting. The dollar failed to find support from Wednesday’s Nov ISM services index, which unexpectedly rose to a 9-month high. President Trump said on Tuesday that he will announce his selection for the new Fed Chair in early 2026.  Bloomberg reported last week that Nationa ...

The dollar index (DXY00) today is down by -0.38% at a 5-week low. The dollar was undercut by today’s weak Nov ADP report, which was dovish for Fed policy.  The dollar recovered from its worst level today after the Nov ISM services index unexpectedly rose to a 9-month high. President Trump said on Tuesday that he will announce his selection for the new Fed Chair in early 2026.  Bloomberg reported last week that National Economic Council Director Kevin Hassett is seen as the likely choice to succeed Powell. ...

The dollar index (DXY00) today is up slightly by +0.05%.  Higher T-note yields today are supportive of the dollar as the 10-year T-note yield rose to a 1.5-week high at 4.11%.  Also, today’s action by the OECD to boost its US 2025 GDP forecast was supportive for the dollar.  Strength in stocks today is limiting gains in the dollar as it reduces liquidity demand for the dollar. The dollar is being undercut by expectations for a rate cut at next week’s FOMC meeting, as the swaps market now discounts a 96% c ...

The dollar index (DXY00) on Monday fell to a 2-week low and finished down by -0.05%.  The yen’s strength is weighing on the dollar on Monday after BOJ Governor Ueda signaled a possible interest rate hike at this month’s policy meeting.  Also, Monday’s weaker-than-expected Nov US ISM manufacturing index is bearish for the dollar.  In addition, the dollar is under pressure amid expectations for a Fed rate cut at next week’s FOMC meeting, as the swaps market now discounts a 96% chance of a rate cut at the Dec ...

The dollar index (DXY00) on Wednesday gave up an early advance and finished down by -0.08%.  The dollar fell slightly on Wednesday after the Nov MNI Chicago PMI posted a 17-month low. Also, strength in stocks on Wednesday has curbed liquidity demand for the dollar.  The dollar initially moved higher on Wednesday on better-than-expected US economic news, with weekly jobless claims unexpectedly falling to a 7-month low and Sep capital goods new orders rising more than expected. The dollar is also under pres ...

Economic Indicators - The dollar index fell by -0.04% after reaching a 5.5-month high, influenced by mixed economic data [1] - US September nonfarm payrolls increased by +119,000, surpassing expectations of +51,000, indicating a stronger labor market [3] - The September unemployment rate unexpectedly rose by +0.1% to 4.4%, the highest in nearly four years, suggesting some weakness in the labor market [3] - Weekly initial unemployment claims decreased by -8,000 to 220,000, better than the expected 227,000, while continuing claims rose to 1.974 million, the highest in four years [2] - October existing home sales rose by +1.2% month-over-month to 4.10 million, exceeding expectations of 4.08 million [4] Federal Reserve Outlook - Market expectations indicate a 39% chance that the Federal Open Market Committee (FOMC) will cut the fed funds target range by 25 basis points at the next meeting on December 9-10 [4] - Cleveland Fed President Beth Hammack expressed concerns that lowering interest rates could prolong elevated inflation and encourage risk-taking in financial markets, which supports a hawkish stance [4] Eurozone Context - The EUR/USD pair fell by -0.04%, reaching a two-week low, influenced by a weaker-than-expected Eurozone consumer confidence index [5] - The European Central Bank (ECB) is perceived to be nearing the end of its rate-cutting cycle, contrasting with the Fed's expected rate cuts through the end of 2026 [5]

Core Insights - The dollar index rose by +0.65%, reaching a 2-week high, driven by the cancellation of the October employment report and hawkish FOMC meeting minutes [1][4] - The yen weakened significantly, hitting a 9.75-month low, due to concerns over increased Japanese government debt from a proposed stimulus package [2][7] - The US trade deficit narrowed more than expected, further supporting the dollar [2][3] Dollar Performance - The dollar's strength was bolstered by the cancellation of key employment data, reducing the likelihood of a Fed rate cut [1] - The hawkish tone of the FOMC minutes indicated that many officials prefer to keep interest rates steady for the remainder of the year [4] Yen and Japanese Economic Concerns - The yen's decline was exacerbated by dovish comments from a BOJ advisor, suggesting no interest rate hikes before March [7] - A supplementary budget of approximately 20 trillion yen ($129 billion) is anticipated to stimulate domestic demand, raising concerns about Japan's debt burden [7] Trade Deficit Impact - The US trade deficit shrank to -$59.6 billion in August from -$78.2 billion in July, which was narrower than the expected -$60.4 billion [3]

Group 1: Currency Movements - The dollar index (DXY) increased by +0.39%, reaching a 1.5-week high, driven by weakness in the yen and a narrowing US trade deficit [1][3] - The yen fell to a 9.75-month low against the dollar due to dovish comments from a Japanese government advisor and concerns over Japan's increasing debt burden [6][1] - The euro declined by -0.23% to a 1-week low, influenced by the dollar's strength and central bank divergence, with the ECB expected to halt rate cuts while the Fed may continue to cut rates [4][5] Group 2: Economic Indicators - The US trade deficit for August narrowed to -$59.6 billion from -$78.2 billion in July, better than the expected -$60.4 billion [3] - US MBA mortgage applications decreased by -5.2% in the week ending November 14, with the average 30-year fixed mortgage rate rising to 6.37% [2] - Japanese core machine orders saw their largest increase in six months, and the 10-year Japanese government bond yield reached a 17-year high of 1.781% [7]