- The US dollar is sinking, with the DXY US dollar index of around 0.60%.
- China said tariffs need to be first, before the talks begin.
- The US dollar index remains to be located below the level of rotation of 100.00.
The US Dollar Index (DXY), which monitors the US dollar (USD) performance against six major currencies, lower trade, approximately 0.60% on the start of the US trading session on Thursday. The knee-knee reaction came after comments from US president (US) Donald Trump and Treasury Secretary Scott Bessent. Both individuals said that no unilateral offer was made in China from the US to lower tariffs, as Trump said the reward tariffs could be re -evaluated if negotiations would not go the way the Trump administration wanted them to go, the Bloomberg reports.
In the face of the economic calendar, a intensive day of trading was preceded. Besides weekly Unemployed claimBoth are Chicago Fed The tracker activity and the Kansas Fed Manufacturing Index should be released. The main focus, however, is likely to be in strong orders of commodity orders for March, with markets expect to increase orders at a faster speed of 2%.
Daily -Sun Digest Market Movers: Issues in China respond
- The Financial Times reported that China called the US to “fully cancel all steps in the unilateral tariff” if it wanted trade talks on Thursday a few hours before the US opening. Previous comments and statements from Trump managing a possible trade deal with China have been called Beijing's 'fake news'.
- At 12:30 GMT, the Chicago Fed National Activity Index for March should be. No forecast available, and the previous reading entered 0.18.
- At the same time, the strong US goods for March and the claims of unemployment should be:
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- The headline durable goods are expected to jump 2% out of 1% previously. Orders without cars and transportation are expected to increase by 0.2%, less than 0.7% advance detected a month before.
- The weekly initial claim that unemployed is expected to tick 221,000 from 215,000. Continued claims are expected to remain stable around 1.88 million.
- At 14:00 GMT, the existing home sale data for March will be published. The sales are expected to soften to 4.13 million against 4.26 million in February.
- Near 15:00 GMT, the Kansas Fed Manufacturing Activity index is expected for April. No forecast available with the previous number in 1.
- The equities look fuzzy this Thursday, with minor losses in Europe. US futures face more than 0.30% decline.
- The CME Fedwatch's tool shows the chance of an interest rate cut by the Federal Reserve at the May meeting at 6.1% against a 93.9% possibility of no change. The June meeting still has about a 58.7% chance of a cutting rate.
- The US 10-year yields trade around 4.33% looking for direction because markets face some knee reactions to Trump's comments.
US Dollar Index Technical Analysis: Head risks and volatility
The US Dollar index (DXY) has been backed off again after a two-day recovery. It looks like the DXY will start combining, trading on a tight range between 100.00 and 98.00. Entrepreneurs are likely to feed on the constant reactions of this knee and may choose to look for other places to put their money, with gold as the preferred sweet place.
Upside down, DXY's first resistance arrived at 99.58, acting again as a wrong break that took place Wednesday and Thursday. If the US dollar can be positive again, look for 100.22 with a break back above the 100.00 level of cycle as a bullish signal of their return. A recovery firm is a return to 101.90.
On the other hand, the support of 97.73 is very close and can be at any moment. In addition, a rather thin technical support enters 96.94, before viewing the lower level of the new price range. It is at 95.25 and 94.56, which means fresh lows that have not been seen since 2022.
US Dollar Index: Daily -Taral chart
US Dollar FAQ
The US dollar (USD) is the official currency of the United States of America, and the 'de facto' currency of a significant number of other countries in which it is found in circulation next to local notes. This is the most severely exchanged currency in the world, worth more than 88% of all global foreign exchange transfers, or an average of $ 6.6 trillion in transactions per day, according to data from 2022. Following World War II, the USD took from the British Pound as the world's reserve currency. For most of its history, the US dollar was gold -back, to the Bretton Woods agreement in 1971 when the gold standard left.
The most important single factor affecting the value of the US dollar is financial policy, shaped by the Federal Reserve (FED). Fed has two mandates: to achieve control inflation and promote full work. Its main tool to achieve these two goals is by organizing interest rates. When prices rise rapidly and inflation is above the target of 2% of the Fed, the Fed will increase rates, which contributes to USD value. When inflation falls below 2% or the unemployment rate is too high, the Fed may lower interest rates, with a greenback weight.
In extreme situations, the federal reserve can also print more dollars and make easing (QE) volume. QE is the process by which the Fed greatly increases the flow of credit to a stuck financial system. This is a non -standard policy proposal used when credit is dry because banks will not lend to each other (out of fear of default counterparts). This is a last way if only the decrease of interest rates is not likely to achieve the required result. It was the Fed weapon chosen to fight the credit crunch that occurred during the great financial crisis in 2008. It involves the Fed printing more dollars and used them to buy US government bonds predominantly from financial institutions. QE usually leads to a weaker US dollar.
The quantity of tightening (QT) is the reverse process in which the federal reserve stops buying bonds from financial institutions and does not re -consist of the principal from the bonds it holds in new purchases. This is usually positive for the US dollar.
