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U.S. Dollar Index

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History of U.S. Dollar Index

Important events

Dec 072023

DXY: Dollar Index Rejected at 104.00 Threshold Riding 3-Day Gain. Jobs Data Ahead.

Dollar index turned on the offensive this week as FX traders seek to price in tomorrow’s nonfarm payrolls data.

  • The US dollar index (DXY) ricocheted off the 104.00 mark early on Thursday and was looking to snap a three-day winning streak. The gauge, measuring the dollar’s value against a basket of six rival currencies, has been climbing an upward slope since its four-month low of 102.50 hit in late November.
  • Forex speculators are turning their focus on the upcoming jobs report. On deck for Friday, the nonfarm payrolls data is expected to churn out another cool print. Analysts have pinned their hopes at 180,000 new jobs created. If true, it will be another sign that the economy is softening.
  • Across currency pairs early today, the dollar pared back some gains. The EUR/USD pair hit $1.0750 and rebounded to paint a green intraday candle. The GBP/USD is also looking to the upside, while the USD/JPY nosedived more than 1% to trade near ¥145.00.
Illustration by TradingView
Dec 012023

DXY: Dollar Index on Pace for 3rd Straight Losing Week as Rate Prospects Dent Demand

The shifting narrative is now phasing the dollar out of investor sight as markets are eager to get first signs of rate cuts.

  • The dollar index (DXY) slipped under 102.50 this week, poised to wrap up its third consecutive week of declines. Shifting interest-rate prospects have turned investors against the buck as markets look elsewhere for bargains. The dollar index has erased roughly 3.5% of its peak 2023 valuation of 107.36 to trade near 103.30 today.
  • Currency traders appear too optimistic on interest rates now that inflation has come down significantly. With consumer prices easing to 3.2% in October, and the Fed’s preferred inflation gauge, PCE, coming in at an expected 3.5% on Thursday, rumors run rampant that interest rates could use a trim.
  • But the Federal Reserve has given no indications of a potential rate cut any time soon. With that said, the US central bank is expected to hold the benchmark rate at 5.25% to 5.50% at its Dec. 12 – Dec. 13 meeting. Only then will investors get more insight into the projected rate-movement timeline.
Illustration by TradingView
Nov 272023

DXY: Dollar Index Reels from 2-Week Slide as Monster Rally Skids on Rate-Hike Pause

Investors are solidifying their expectations that the Federal Reserve won’t tweak rates to the upside any time soon.

  • The US dollar index (DXY) was slow to move earlier today after a second-straight losing week. The gauge, measuring the buck’s strength against six rival currencies, floated above 103.30 in the first deals of the week, down 3.5% from its November high of 107.15.
  • With that recent drop, the dollar index has erased about half of all gains accumulated in the hulking 11-week winning streak through late September. What’s the deal with this decline and why now? Fresh economic data suggests that the labor market is cooling, inflation has peaked, and interest rate hikes are no longer the main character.
  • The dollar is highly sensitive to interest rates, which help lift its returns. Once rates start plateauing (like now), investors have little incentive to stuff their pockets with dollars. Instead, they turn to higher-risk-higher-return prospects such as stocks and did someone say Bitcoin BTCUSD?
Illustration by TradingView
Nov 212023

DXY: Dollar Index Cracks to 103 to Erase 2 Months of Gains. What’s Behind the Move?

The dollar hit a 2-and-a-half month low early on Tuesday as correction mode swept across the forex board. Yen powered the most.

  • The US dollar index (DXY) skittered down 0.3% to 103.10 in early Tuesday deals as market participants reshuffled their currency portfolio. The drop added to a substantial November decline of nearly 4% with the greenback washing out all the gains made for the previous two months.
  • The sweeping dollar correction was observed across the forex board. The major currencies aisle saw increased demand with the Japanese yen rallying the most. The USD/JPY pair tumbled for a fourth straight day today, floating near the ¥147.00 level. The EUR/USD advanced to $1.0960.
  • What’s happening to the US dollar? Low inflation expectations appear to finally be settling in investors’ minds. With consumer prices gradually easing, the Federal Reserve’s rate-hiking campaign is bound to come to a halt. The expected pullback in raising interest rates is driving investors away from the dollar, whose valuation is positively related to interest rates.
Illustration by TradingView
Nov 152023

DXY: Dollar Index Sells Off Nearly 3% to 104.00 as US Inflation Slows to 3.2% for October

The dollar index fell off a cliff following the latest CPI report. The drop in price growth fueled hopes the Fed won’t touch rates any time soon.

  • The US dollar index (DXY) nosedived Tuesday after the latest inflation report sparked excitement that price growth might finally be shrinking. The consumer price index for October showed prices increased by a less-than-expected 3.2%, and below September’s 3.7%. The data triggered a sharp selloff in the US dollar.
  • The dollar index, a gauge for the greenback’s value against six major rivals, fell roughly 3% on the day, sliding from 107.00 to levels near 104.00. Across individual players, the EUR/USD rallied nearly 2% to $1.0880, the GBP/USD added just over 200 pips to $1.2493, and the USD/JPY tumbled 0.8% to 150.50.
  • Falling inflation is welcome news for markets and for the Federal Reserve. The central bank is now widely expected to skip a rate hike at its December meeting. But also to consider another do-without at the first meeting of 2024 if the downward trajectory is sustained, ideally all the way to the 2% target.
Illustration by TradingView
Nov 082023

DXY: Dollar Index Gains Traction for Third Day in a Row Despite Soft Jobs Data

The US dollar is marching forward to 106.00, up roughly 1% this week. The lack of major headlines is expected to keep a lid on volatility.

  • The US dollar index (DXY) is on track to log a third day of gains in a row despite a softer-than-expected jobs data. October’s jobs report, showing 150,000 people were hired, suggested the economy is moderating. The report initially pummeled the dollar as it diminished prospects of another rate hike that could keep the greenback well-bid.
  • In a marked shift in tone, no bears are seen so far into the week. The US dollar index is confidently marching toward the 106.00 threshold, up around 1% since Monday. The elevated optimism, however, is fairly unfounded – no major news is on deck this week, hinting that volatility could be gravitating around the flatline.
  • Across forex deals early on Wednesday, the dollar was trading at $1.0660 against the euro EUR/USD, down from a weekly peak of $1.0760. The USD/JPY gained momentum and topped ¥150, well on its way to ¥151 on the lack of any intervention signals from Japan officials. And the GBP/USD pair dropped to $1.2250 from a Monday high of $1.2430.
Illustration by TradingView
Nov 022023

DXY: Dollar Index Drifts 0.8% Lower to 106.20 as Fed Keeps Rates Steady at 22-Year High

For the second time in a row, the Fed decided to hold rates unchanged but hinted it’s not done raising to stamp out sticky inflation.

  • The US dollar index (DXY) retreated 0.8% to a Thursday low of 106.20 as FX traders digested the latest Federal Reserve update. The central bank left its benchmark lending rate unchanged at 5.25% to 5.50%, a 22-year high, as it’s parsing mixed economic signals such as strong growth data, elevated consumer spending, and increased borrowing costs.
  • The index, gauging the dollar’s strength against six rival currencies, is still mostly undefeated in the long run. It’s flaunting gains of 7% for the past four months while other FX peers are nursing heavy wounds from the relentless rally of the greenback. Still, some reprieve was noticed yesterday when the dollar pulled back against the yen for a second straight day.
  • In other corners of the currency market, the euro is seen sprinting, taking full advantage of the dollar’s weakness. The EUR/USD pair is higher by just over 0.8% in the past couple of trading days, moving from $1.0515 to $1.06. Jobs data is on deck tomorrow and markets are already bracing for volatility.
Illustration by TradingView
Oct 242023

DXY: Dollar Index Loses Steam to Float at 105.50 as Treasury Yields Drift Back to 4.8%

The greenback pared gains against major rivals while the 10-year yield topped 5% but then dived near the 4.8% mark.

  • The US dollar index (DXY) fell 0.8% in early-trading Tuesday after forex participants looked elsewhere to find bargains. The gauge, measuring the dollar’s value against six rival currencies, fell to 105.50 from a session high of 106.40, and it’s looking to close a second straight day in the red.
  • The greenback was on the defensive against most major rivals. The EUR/USD flipped higher to trade near $1.0650. The USD/JPY broke its range-bound trading to the downside and erased about 50 pips to an exchange rate just under ¥149.50. And the GBP/USD rose for a fourth-straight day to cross $1.2250.
  • Against that backdrop, the yield on the 10-year Treasury note topped 5% on Monday, a high unseen since 2007. It then retreated to find support at 4.84%. The 2-year Treasury yield fell to 5.06% and the 30-year Treasury yield dropped to 4.998%. Treasury notes are generally regarded as a safe, no-risk investment since they’re backed by the US government.
Alexander Mils / Unsplash
Oct 192023

DXY: Dollar Index Steady Above 106.00 Ahead of Jay Powell Speech

In an otherwise lightweight economic calendar, the dollar is waiting patiently to hear the Fed chair’s remarks on interest rates.

  • The US dollar index (DXY) was floating sideways early Thursday as market participants braced for a speech by Fed chair Jay Powell. The currency gauge, stacked up against six rival currencies, was gravitating toward the 106.50 mark, well above its weekly low of just under the 106.00 threshold.
  • Eyes will be on Jay Powell as a participant in a discussion at the Economic Club of New York later today. His remarks are expected to lay out the Fed’s path on the interest-rate front and how the US central bank sees the economic outlook for the near future.
  • In the meantime, other key forex players were seen retreating across the board. The EUR/USD pair slipped Wednesday and remained under pressure in early Thursday deals. The USD/JPY continued its ascent toward the key 150.00 level with no sign of intervention from Japan officials.
Simone Fontana / Flickr
Oct 122023

DXY: Dollar on Track for 2nd Losing Week After 11-Week Run, Index Sinks to 105.60

Inflation data is coming up today and forex traders are expecting a fairly flat percentage figure. Dollar is retreating across the board.

  • The US dollar index (DXY) is looking to close a second straight week in the red after a historical run of 11 weeks of gains. The gauge, measuring the dollar’s value against a basket of six rivals, snapped its monumental streak last week, dipping a negligible 0.2%.
  • Had the upside swing continued for 13 weeks straight, it would’ve been the dollar’s longest weekly winning string since record-keeping began in 1985. Earlier today, the dollar index was floating just over the 105.60 mark, down about 0.4% for the past five trading days.
  • Inflation data is pending release later today. The US CPI report, analysts say, is not likely to bring any big changes to the inflation’s trajectory. Price pressures are expected to show a modest decline to 3.6% in September, from the same period a year ago.
Illustration by TradingView
Oct 062023

DXY: Dollar Steady Near 106.50 as 12-Week Winning Streak Hangs on a Thread

The monster rally in the US dollar has been backpedaling from its weekly highs. Jobs data today is expected to inject fresh volatility.

  • The US dollar index (DXY) is on the verge of breaking a winning streak stretching across 12 straight weeks. The benchmark, a measure of the dollar’s value relative to six other major currencies, is floating near the 106.50 mark, down from a weekly high of 107.40 – a top unseen since November last year.
  • Today’s nonfarm payrolls data is likely to inject fresh volatility in the dollar’s day-to-day. Depending on the actual number of new jobs added in September, against a consensus call for 163,000, forex markets could either see a renewed upside momentum, or a snap of the longest weekly streak since 2014.
  • A third scenario would be a non-eventful jobs report where data aligns with expectations, which have already been baked into the dollar’s trajectory. Currency pairs early on Friday are waking up with caution and risk aversion as thin dealmaking liquidity spreads eerie quietness.
Illustration by TradingView
Oct 022023

DXY: Dollar Index Kicks Off October Flat. Is the 11-Week Winning Streak at Risk?

Fed chief Jerome Powell is set to speak later today. Friday brings the latest jobs report. Here’s what’s happening to the dollar.

  • The mighty US dollar is off to an underwhelming start of the new month. On the first trading day of October, the US dollar index (DXY) pulled back by about 0.2% as early-day dealmakers anticipate a flurry of data to pile down the week. The dollar index presently floats near 106.00, down from a session opening of 106.35. Last week, the greenback notched its 11th straight week of gains.
  • Against the backdrop of a retreating US dollar, stocks are optimistic to roll into the final quarter of the year. Futures contracts tied to the major equity averages ticked higher by more than 0.5%, with Nasdaq futures shooting up 0.7% ahead of the opening bell in New York.
  • Whether this would be a quick shot of waning enthusiasm, or something more lasting, markets will find out with the help of this week’s events. Federal Reserve Chairman Jerome Powell speaks later today and traders expect to hear more about that overused “higher-for-longer” phrase. Friday is Jobs day and all eyes will be on September’s jobs figures.
Simone Fontana / Flickr
Sep 292023

DXY: Dollar Index Trims Weekly Gains in Half. Is the Reversal Finally Coming?

“Is it happening, finally?” – dollar bears, probably, as the US dollar flashed its first signs of weakness in months.

  • The dollar index (DXY) erased more than half of its weekly advance on Thursday and early Friday but is still on track for a weekly gain, its 11th straight one, of just under half a percent. A shifting market sentiment narrated moves across the board yesterday and the prevailing market theme today is ‘cautious optimism.’
  • A slight retreat in the US dollar led to rising valuations of rival currencies such as the euro, the pound and the Japanese yen. Tie that forex dynamic to an uplifted stock market, a jump in Bitcoin and crypto assets and you’ve got a market excited about growth prospects.
  • In other words, investors ditched the safe-haven allure of a dollar in a high interest-rate environment. And opted for risky assets, brushing off inflation concerns, at least another rate hike this year, a worsening $33tn US debt and a budget battle between legislators that once again threatens to shut down the federal government.
Illustration by TradingView
Sep 262023

DXY: Dollar Keeps Wrecking Short-Sellers in 11th Straight Week of Gains, Tops 106.00

A relentless greenback has punished, hammered, pummeled, and disciplined traders who hold short positions, anticipating a decline.

  • The US dollar is mercilessly eating up all shorts in its eleventh consecutive week of massive gains. Such a hulking flex in the dollar index (DXY) was last seen in mid-2014 when the greenback was shooting green arrows for twelve weeks in a row. The steep rise kicked off in July and has so far added over 6% to the dollar, moving the index from 99.50 to current market price above 106.00.
  • The mighty buck is peaking at multi-month highs against the euro - $1.0569 – and against the Japanese yen – ¥149.00. Other rival currencies weren’t left whole either. And along the way, banged-up short-sellers have witnessed first-hand what ‘higher for longer’ means to the US dollar.
  • The higher-for-longer credo broadcasted from the Federal Reserve last week had the American currency riding to higher grounds. Forex bros are piling new cash in their dollar reserves with the conviction that they can get more bang for their buck before the US central bank start cutting rates much later than anticipated.
Slashio Photography / Unsplash+
Sep 212023

DXY: Dollar Index on Pace for 10th Straight Winning Week. Will It Reach a Double Top?

Should you get your shorts at the ready? The US dollar is staring at immediate resistance just under 106.00 after the Fed rattled markets.

  • The US dollar index (DXY) advanced sharply on Wednesday, moments after Fed chief Jay Powell’s much-anticipated press conference. A rate hike wasn’t on the cards this time, but policymakers expect to raise at least once more this year. The news sent stocks plunging and the dollar rallying.
  • So much rallying that the index is looking to close its tenth straight week of gains. The last time such a jumbo streak happened was in mid-2014 – 12 weeks of higher highs in a row. The dollar pressed higher against all of its major rivals. The EUR/USD hit a fresh low of $1.0616, the GBP/USD dropped to $1.23, and the USD/JPY jumped to ¥148.45.
  • Should you get your shorts at the ready? The dollar index is fast-approaching its mid-term resistance – a potential double-top formation just under 106.00. If you’re not too picky, you could say that the upcoming resistance would meet a third leg up for a triple-top pattern. Either way, that threshold will be a battleground for bulls and bears.
Rodion Kutsaiev / Unsplash+
Sep 112023

DXY: Dollar Index Closes Eighth Straight Winning Week. How Long Can the Rally Last?

The powerful upward swing has taken bears by surprise. Could upcoming inflation data knock the dollar later this week?

  • The US dollar index (DXY) notched an eighth consecutive week of gains, underpinned by a robust US economy, while rival economies wobble and wiggle. The index, measuring the dollar’s value against six other currencies, pierced the 105.00 mark on Friday. It’s up a whopping 5% in the past two months.
  • The summer of 2023 will go down as a period of much pain for dollar bears. Calling for the dollar’s demise since late April, they have been battered hard as the king of forex trading has turned sharply higher. The US currency has inflicted losses to every one of the major rivaling currencies in the past quarter.
  • How long can that humiliation last? Inflation data out of the US this week is expected to show price pressures climbed slightly to 3.6% in August from 3.2% in July. Rising inflation could be a hot sign that the Fed may decide to bump rates later this month. All of that could further fuel the dollar. Lowering inflation, theory suggests, could take the edge off the buck.
Katelyn Perry / Unsplash
Sep 042023

DXY: Dollar Index Whipsaws Friday Deals but Traders Ease Into Holiday Week

The latest jobs data fueled a super strong rally in the dollar, after first pulling off a fake drop in the greenback, entrapping bears.

  • The US dollar index (DXY) reversed a short-lived Friday drop, prompted by the latest jobs figures out of the US. The dollar initially showed a bearish reaction to August’s 187,000 new jobs created, but then made a U-turn, ploughing through major rivals, showing its dominance once again.
  • The dollar index added about 1% from its lows on Friday to regain the 104.00 level with a session high of 104.30. Early on Monday, dealmaking moved the dollar mostly sideways as traders weren’t too hyped to get into the week. With that in mind, let’s distil what’s ahead.
  • Today is Labor Day in the US and stocks won’t open for trading. Forex markets are operating normally, but traders might see less volume and thinner volatility. Down the week, not much has been planned on the news front - Thursday brings the weekly jobless claims report and on Friday Germany will release its CPI data, or inflation figures, for August.
Annie Spratt / Unsplash
Aug 312023

DXY: Dollar Index Gains Traction as Traders Prepare for Latest Jobs Report

The dollar index is ready to meet its next catalyst – the jobs report for August is expected to show a tighter labor market with 170k new jobs.

  • The US dollar index (DXY) advanced early on Thursday as forex bros were already eyeing Friday’s jobs data. The nonfarm payrolls report for August is projected to show labor market conditions tightened. The expected number of new jobs added is 170,000, down from 187,000 in July.
  • In that context, the dollar index turned up to 103.30 in early dealmaking, looking to snap a three-day losing streak from a peak of 104.45. The attempt to leap higher aims to return the DXY to its August rally, which has added some 1.5% to the dollar’s valuation against a basket of major currencies.
  • To break it down, the EUR/USD is looking to close a losing August after erasing 0.9% for the month. The USD/JPY is set for a 2% monthly gain, fueled by broad yen weakness. And the GBP/USD is staring at a 1% loss for the same span. In short, all three rival currencies were dominated by king dollar.
Illustration by TradingView
Aug 282023

DXY: Dollar Index Gains Momentum in Nonfarm Payrolls Week

The greenback was seen sprinting against other major currencies as jobs data on Friday is expected to show a cooling labor market.

  • The US dollar index (ticker: DXY) advanced on Friday and stayed well-bid early on Monday as forex traders geared up to hear the latest on the jobs front. The summer months are in their final lap and the August jobs number is right around the corner. Here’s what’s moving the dollar.
  • Nonfarm payrolls, or new hires added to the US economy, are expected to come in at a moderate 170,000 for August. The figure, if materialized, will be lower than July’s 187,000 new workers. And, what’s more, it will solidify the trend of lowering job numbers, indicating a cooling economy.
  • In that context, the US dollar punished the euro on Friday as the pair slid under the $1.08 level and busted a long-term support level – the 200-day moving average. The USD/JPY maintained its upward trajectory, raising the exchange rate near a 10-month high above ¥146.50.
Rodion Kutsaiev / Unsplash
Aug 242023

DXY: Dollar Index Drops from 3-Month High as Traders Anticipate Jackson Hole Event

The symposium is likely to bring further clarity into the path of rate increases as Fed chief Jay Powell delivers a speech.

  • The US dollar index (ticker: DXY) retreated early on Thursday, following a drop on Wednesday to levels near 103.00 from a 3-month high at just under 104.00. The US dollar has been moving steadily to the upside for the past month and a half, gaining a total of 4% for the period.
  • Forex markets can get wild tomorrow, depending on how the Jackson Hole symposium goes. It’s the annual meetup for central bankers and Federal Reserve chief Jay Powell will be delivering his notes about the growth of the US economy and the Fed’s next moves in the rate hike campaign.
  • With that said, the EUR/USD pair is struggling to take off after a heavy downside move this month. The exchange rate is fluctuating near $1.0850, down from $1.1280 just a month ago. The USD/JPY found support this morning, buoying the price to ¥145.40 from ¥144.60.
Illustration by TradingView