US DOLLAR OUTLOOK – FOMC PROTOCOLS, RETAIL, YIELDS FOCUS
- US dollar bears sent a broader DXY index rebound -0.3% lower last week
- Inflation and consumer sentiment data had a negative effect on the Treasury’s performance
- FOMC minutes of release may revive Fedi bulls and USD bulls
The US dollar weakened broadly, pulling last week’s DXY index down -0.3%. This erased about half of post-income incomeNFP -d and leaves the broader US dollar 0.4% higher on a monthly basis. Recent selling pressure on US dollar pricing is largely followed by disappointing economic data in the eyes of Fed bulls. Specifically, monthly inflation decelerated by more than 0.9% in June to 0.5% in July. The slowdown in the CPI gave credibility to Fed’s temporary inflation stance, which in turn led to Fed’s reduced stakes and the strength of the US dollar.
TEN-YEAR MONEY STATE OVERVIEW OF THE US DOLLAR INDEX
The weakness of the US dollar accelerated further during Friday’s trading session as markets digested the latest consumer interest report. There is a great deal of concern about the covidi delta variant, which is the title of consumers the index fell below 81.2 in July to 70.2 in August. This is a record and the seventh largest drop in departures consumer sentiment the lowest figure since 2011. Government bond yields fell in response and dragged the US dollar. The ten-year Treasury yield fell, for example, by 8 basis points, such as 1.28%.
This means that the future direction of the US dollar is likely to depend on how the Treasury’s performance responds to the forthcoming release of the FOMC protocol and retail data. FOMC protocol 27-28. The July Fed meeting, which eventually changed “significant progress” in a press release, adds some color to the Federation’s humiliating debate and whether central bank officials have the appetite to slow asset purchases before or after the end of the year. Retail data, on the other hand, may shed light on the extent to which deteriorating consumer sentiment has affected spending patterns.
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