The dollar index (DXY00) today is up by +0.18%. The dollar is climbing today on easing global trade tensions, which are supportive of economic growth prospects. The US and South Korea finalized a trade deal today that will see South Korea make $150 billion in shipbuilding investments and cap US tariffs on South Korean goods at 15%. Also, President Trump said he expects to lower tariffs on Chinese goods over the fentanyl crisis.
Gains in the dollar are limited amid expectations that the FOMC will cut interest rates by 25 bp later today and possibly end quantitative tightening. The dollar remains under pressure from the ongoing US government shutdown. The longer the shutdown is maintained, the more likely the US economy will suffer and the more likely the Fed will have to cut interest rates.
