Home / Market Update / Forex Market / US dollar surges ahead of looming Fed decision

US dollar surges ahead of looming Fed decision

The DXY Index advanced to 106.70 ahead of the Fed’s interest rate decision on Wednesday, indicating that the US dollar is strengthening. The US economy proved remarkably resilient in the face of tightening measures, which contributed to the strengthening of the Greenback. While the S&P Dow Jones Indices reported that the S&P/Case-Shiller Home Price from August exceeded expectations, the US Conference Board Consumer Confidence Index from October outperformed forecasts.

The Chicago PMI for October registered at 44, down from the previous reading of 44.1 and under the consensus estimate of 45. The yields on US government bonds are mixed; the yields on the 2, 5, and 10-year bonds are 5.07%, 4.81%, and 4.86%, respectively.

There is a low probability of a 25 basis point hike in December, according to the CME FedWatch Tool, and a pause in November. There is still little momentum even though the US Dollar Index bounces back above the 20-day SMA.

The DXY Index’s technical outlook is still neutral to bearish as bulls are beginning to show signs of fatigue. Investors may continue to model their expectations for the upcoming meeting based on the policy statement and remarks made by Fed Chair Jerome Powell.

Check Also

Oil Markets Eying Weekly Gains Following PMI Data

Crude Oil prices rebounded after a volatile Friday, driven by a surge in the US …