US Dollar Index Renews Upside Above 104 Mark

Published on Jul 16, 2024 11:56

The US dollar rebounded on Tuesday after a recent streak of losses amid rising expectation of Federal rate cuts. Federal Reserve Chair Jerome Powell reinforced expectations that the central bank will start cutting interest rates soon. Powell said on Monday that recent data �add somewhat to confidence� that inflation is returning to target and that the central bank will not wait until inflation hits 2% before cutting rates. The dollar index is however keeping upside intact and now above 104 mark, up 0.2% on the day as markets prefer to maintain cautious stance following a failed assassination attempt on former US President Donald Trump. Alongside DXY, yield on 10-year Treasury note rose above 4.23%, rebounding from 4-month lows. Moreover, markets have seemingly priced in a near-term rate cut and prospects of a second Trump presidency boosted the dollar and Treasury yields as his policies are seen as inflationary due to tax cuts, tighter immigration and higher import tariffs. Among basket currencies, EURUSD and GBPUSD are quoting slightly lower by around 0.1% at $1.0917 and $1.2963 respectively.