The dollar index (DXY00) Monday rose by +0.26%. The dollar on Monday recovered from early losses and turned higher after T-note yields rebounded from losses and moved higher, strengthening the dollar's interest rate differentials. Also, hawkish comments from Fed Governor Kugler supported the dollar when she said inflation concerns from tariffs are more pressing than economic growth concerns.
The dollar today initially moved lower because of concerns that the escalating global trade war would derail the economy and force the Fed to cut interest rates. The dollar is also facing a confidence crisis as the US renegotiates its relationships with its trading partners, diminishing the dollar's reserve-currency status and prompting some foreign investors to liquidate their dollar assets.
