The dollar index (DXY00) today is up by +0.14% and climbed to a 2-week high. The weakness in stocks today has boosted liquidity demand for the dollar. Hawkish comments today from New York Fed President Williams and Chicago Fed President Goolsbee were positive for the dollar when they signaled their support for steady Fed policy. Today’s decline in T-note yields has weakened the dollar’s interest rate differentials and is limiting gains in the dollar.
New York Fed President Williams said, “The current modestly restrictive stance of the Fed’s monetary policy is entirely appropriate given the solid labor market and inflation still running somewhat above our 2% goal.”
