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Barchart
Barchart
Rich Asplund

BIZARRE: Dollar gains and gold falls on higher bond yields - What They Never Told You

The dollar index (DXY00) today is up by +0.07% at a 2-1/2 week high.  The dollar is supported by today’s news of an unexpected increase in the US Nov import price index ex-petroleum, a hawkish factor for Fed policy.  The dollar is also seeing support from stronger interest rate differentials with today’s rise in the 10-year T-note yield to a 2-1/2 week high. 

Strength in stocks today has reduced liquidity demand for the dollar.  The dollar is also being undercut by expectations that the Fed will cut interest rates by -25 bp at next week’s FOMC meeting. 

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