The US Dollar Index slipped to its lowest level in almost 8 months as investors speculate that the Fed is more than likely to push back on a 2016 rate hike. Since Janet Yellen, the head of the Federal Reserve, laid the path for a dovish outlook, the Dollar Index has lost about 3% of its worth. The likelihood of a June rate hike is now less than 20% as suggested by Fed Fund futures. Dollar crosses also saw some heavy sell pressure, especially against the Euro and the Pound Sterling.
As reported at 10:40 am (BST) in London, the EUR/USD was up 16% at $1.1422; the pair has ranged from $1.1400 at the low end to $1.1465 at the high. The AUD/USD pair was higher at $0.7657, a gain of 0.81%. The US Dollar Index was trading at 93.17 .DXY, down 0.14%; FX traders use the Index to gauge the Dollar’s relative strength versus major rivals.
Pound Lifted despite Mixed Bag of Data
The Pound Sterling is getting some support from this morning’s release of producer price inflation inputs and the retail price index, among others. While the results were generally mixed, there were enough upbeat surprises to provide a lift to the Cable. The UK’s Office of National Statistics reported that consumer prices edged 0.5% higher in March (year-over-year), against an 0.4% forecast. The GBP/USD was trading at $1.4305, a gain of 0.49% for the Pound Sterling.