The dollar index (DXY00) rallied to a 2-week high on Wednesday and finished up by +0.62%. The dollar found support on Wednesday amid easing global trade tensions, which are supportive of economic growth prospects. The US and South Korea finalized a trade deal on Wednesday 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 accelerated on Wednesday despite the FOMC cutting interest rates by 25 bp later today and ending quantitative tightening. The dollar jumped on hawkish comments from Fed Chair Powell, who said a rate cut at the December FOMC meeting "is not a foregone conclusion."
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