US Dollar Index Slides For The Fourth Consecutive Day

The dollar Index (DXY) slides by 0.07% but manages to remain above the 96.02 figure as the New York session winds down. Omicron-related positive news improved market mood.

So, improvement in the market sentiment increased the appetite for riskier assets and consequently weakened the dollar’s safe-haven status despite upward bias, though the American currency is still testing the bottom-trendline of the ascending triangle during the New York session.

In the last couple of days, the US Food and Drug Administration approved Pfizer and Merck Covid-19 treatment pills, meaning that high-risk patients can have medication at home. A study in South Africa showed that people infected with the Omicron variant would be 80% less susceptible to requiring hospitalization. In the UK, the Health Security Agency reported that 50-70% of people testing positive for the Omicron strain would not need to be hospitalized.

With two countries spreading positive news about the Omicron variant, investors’ worries about possible economic slowdown have been relieved.

In the meantime, the US Treasury bond 10-year benchmark note raises some three and a half basis points, sitting at 1.494%, closing to the 1.50% threshold. The US macroeconomic calendar featured a large bulk of data. The Fed’s favorite gauge of inflation the Core Personal Consumer Expenditure (PCE), increased by 4.7%, higher than the 4.5% expected, justifying the US central bank’s faster bond-taper decision revealed on its last meeting. In the labor market, Initial Jobless Claims for the week ending on December 17 rose to 205K in line with expectations.

Consumer confidence increased, with the UoM Consumer Sentiment Index for December at 70.6, higher than the 70.4 foreseen. At the same time, Durable Good Orders for November rose by 2.5%, higher than the 1.6% estimated.