Dollar Index - Bullish momentum stalls as focus shifts to US wage growth number
|The four-day winning streak in the Dollar Index (DXY) appears to have run out of steam as the focus shifts to Friday’s US wage growth numbers.
DXY clocked a high of 100.65 on Friday and was last seen trading around 100.37 levels.
10-year Treasury yields remains flat lined
The benchmark 10-yr treasury yield continues to trade in the sideways manner around 2.4%, even though the data released on Friday showed the Fed’s preferred measure of inflation - personal consumption expenditures (PCE) price index gained 0.1% last month after jumping 0.4% in January. That lifted the annualised PCE price index to 2.1%, the biggest gain since April 2012.
The lacklustre action suggests markets are worried about the inflation eating into the consumer spending. Thus, wage growth needs to strong if the consumption is to remain strong amid rising inflation.
As for today, the focus is on the US ISM manufacturing number.
Dollar Index Technical Levels
A break above 100.67 (50-DMA) would expose 100.00 (zero figure) and 101.17 (100-DMA). On the other hand, a breakdown of support at 100.21 (5-DMA) could yield a re-test of 100.00 (zero figure) and 99.79 (Jan 26 low).
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