The dollar index (DXY00) today recovered from early losses and moved up to a 5-1/2 month high based on hawkish Fed comments. San Francisco Fed President Daly said Monday night that there's "no urgency" for the Fed to adjust interest rates and Fed Vice Chair Jefferson said today that if inflation remains elevated, the Fed will hold interest rates higher for longer. The dollar also garnered support on today’s news that US March manufacturing production rose more than expected.
The dollar today initially moved lower after US Mar housing starts and building permits fell more than expected, a dovish factor for Fed policy. The dollar was also under pressure as stocks stabilized, which curbed liquidity demand for the dollar.
