
The dollar index (DXY00) on Monday rose by +0.40% and posted a new 6-1/2 month high. The dollar moved higher Monday on rising bond yields, with the 10-year T-note climbing to a 16-year high. Also, the dollar has carryover support from last Wednesday when the Fed signaled one more +25 bp rate hike this year and projected the fed funds rate next year +50 bp higher than they projected back in June.
Weaker-than-expected U.S. economic news Monday was bearish for the dollar. The Aug Chicago Fed national activity index fell -0.23 -0.16, weaker than expectations of 0.10. Also, the Aug Dallas Fed manufacturing outlook level of general business activity unexpectedly fell -0.9 to -18.1, weaker than expectations of an increase to -14.0.