- The DXY regains ground and retests the 93.75 / 80 area.
- Core US PCE was 3.6% YoY in October, 0.2% MoM.
The US Dollar Index (DXY), which tracks the dollar against a basket of its major rival currencies, accelerates the daily rally and flirts with the 100 hourly simple moving average near 93.80 on Friday.
US dollar index rises on rising yields and persistent inflation
The index extends the bounce from the 93.30 area and manages to advance to the 93.75 / 80 area at the end of the week due to rising US yields and persistent high US inflation.
In fact, yields at the front end and up the curve extend the higher leg to the 0.55% region and the 1.62% zone, respectively, while the long end clings to positive territory around 1.98%.
The index picked up steam after PCE-tracked US inflation figures rose 4.4% in the year to September, while the core PCE rose 3.6% to coincide with the August reading. According to additional data, personal expenses increased 0.6% month-on-month and personal income contracted 1.0% from the previous month.
Technical levels
Now the index is gaining 0.33% to 93.67 and a break above 94.02 (Oct 26 weekly high) would open the door to 94.17 (Oct 18 weekly high) and then 94.56 (Oct 12 high). 2021). On the other hand, the next bearish barrier emerges at 93.27 (October 28 monthly low) followed by 92.98 (September 23 weekly low) and finally 92.86 (100-day SMA).
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