Dollar Index (DXY) bears entered the market and pushed the price down. Fed projections for interest rates remain unchanged.
Dollar Key Considerations
The US CPI figure is still far over the Fed’s inflation objective despite a gradual decline.
The Fed continues to project numerous rate reductions for interest rates.
Technical study of the US Treasury market and the DXY indicates further decline.
US DOLLAR BASE AFTER CPI DATA
The main reading for the US CPI, which is included in the economic schedule beneath, was somewhat less than anticipated at 4.9%. There aren’t any major shocks in this report, which the Fed has welcomed. Following the previous week’s positive US employment data. A CPI surprise may have ‘agressivly’ discounted expectations for a rate move by the Fed. Higher petrol costs added to a high read. Wand this led the inflation rate to deviate from the desired rate of 2 percent.
US Economic Activity Schedule
Fed funds futures suggested prices for end-of-year have risen about 8 basis points since the announcement. and currently anticipate 71 basis points of total rate decreases. Bears returned to the market and pulled prices lower as a result of the USD’s quick response, as seen by the Dollar Index (DXY).
Market Response
As a result, the yield on the ten-year Treasury bond for the US has fallen under the 3.5% level. And the death cross indicator developed. This may indicate that rates are moving closer to the swing bottom of 3.253 percent.
Major Technical Levels
Key Resistance levels:
- 103.42
- 102.81
- 50-day MA (yellow)
- Triangle resistance
- 101.42
Key Support levels:
- Triangle support
- 101.00
- 100.79
- 100.00
