US dollar DXY index advances to daily highs above 95.80

• The DXY index regains traction to the upside and surpasses the 95.80 level.
• US yields are rising and supporting the rise of the DXY index.
• Waller and Clarida from the FOMC are scheduled to speak later in the session.

The US dollar DXY index, which measures the strength of the dollar against a basket of the main currencies, manages to recover the buying interest and rises back above 95.80 on Friday.

DXY Index Rises With US Yields

After two consecutive daily setbacks, the DXY index finally manages to regain its smile and revisits the 95.80 zone at the end of the week. Up to now, the 95.50 area has emerged as quite firm support.

The recovery of the dollar occurs amid better tone in US money markets, where yields are now attempting a slight recovery along the curve.

Meanwhile, inflation concerns continue to dominate the currency scene in global markets, as well as prospects for an early start of the tightening cycle by the Federal Reserve. On the latter, J. Williams of the FOMC suggested Thursday that expectations of future consumer price increases continue to rise.

There is no major data release on Friday’s US economic calendar, which should leave attention to speeches by FOMC permanent voters R. Clarida and C. Waller.

Relevant levels of the US dollar DXY index

At the time of writing, the DXY index is up 0.33% on the day, trading at 95.83. A break above 96.24 (November 17 high), would open the door to 97.00 (round level) and 97.80 (June 30, 2020 high). On the other hand, the next support is at 94.96 (November 15 low), followed by 94.56 (October 12 high) and finally 93.87 (November 9 low).