The US Dollar Index’s Streak Comes to an End
- The US Dollar index will halt its winning streak ahead of the Fed rate decision.
- The Fed is expected to not change its benchmark interest rates in July.
- US Treasury Secretary Scott Bescent said the US and China will continue to talks on maintaining the tariff ceasefire.
The US Dollar Index (DXY), which gauges the dollar’s value against six major currencies, saw its four-day winning streak break during Asian trading on Wednesday, hovering around 98.80. Traders are now keenly awaiting the US Federal Reserve’s interest rate decisions in the later North American session.
There’s a strong consensus that the Federal Reserve will keep its benchmark interest rate stable between 4.25% and 4.50% in July. In fact, current projections through the CME FedWatch tool show a 97% likelihood that rates will remain unchanged at the upcoming meeting.
The FOMC press conference will be closely watched for hints about possible rate cuts come September. Meanwhile, market participants are looking forward to critical economic reports this week, particularly the second quarter Personal Consumption Expenditure (PCE) inflation figures and the employment data for July. These could offer additional insights into the US economic landscape.
Former President Trump, along with his administration, has exerted pressure on Fed Chairman Jerome Powell, raising questions about the independence of central banks and their resistance to political interference. Trump’s criticism of Powell has been quite pronounced, and there were even speculations about possible changes in the Fed’s leadership. However, it seems Trump has somewhat backed off from those ideas for now.
On another note, US-China negotiations in Stockholm on Tuesday concluded without a decision to extend the existing tariff ceasefire. Treasury Secretary Scott Bescent indicated that discussions between the US and China would continue regarding this ceasefire, leading up to a two-week deadline when Trump is expected to make a final call on the matter. Bescent also tempered expectations regarding a refusal to extend the ceasefire.
Today’s US Dollar Price
The following table outlines the exchange rate fluctuations of the US dollar (USD) against various currencies for today. Notably, the dollar has underperformed against the Japanese yen.
| Currency | USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF |
|---|---|---|---|---|---|---|---|---|
| USD | -0.16% | -0.11% | -0.27% | -0.04% | -0.12% | -0.23% | -0.23% | |
| EUR | 0.16% | 0.08% | -0.17% | 0.10% | 0.00% | -0.07% | -0.02% | |
| GBP | 0.11% | -0.08% | -0.24% | 0.07% | -0.05% | -0.12% | -0.08% | |
| JPY | 0.27% | 0.17% | 0.24% | 0.29% | 0.21% | 0.10% | 0.12% | |
| CAD | 0.04% | -0.10% | -0.07% | -0.29% | -0.08% | -0.19% | -0.14% | |
| AUD | 0.12% | -0.00% | 0.05% | -0.21% | 0.08% | -0.07% | -0.02% | |
| NZD | 0.23% | 0.07% | 0.12% | -0.10% | 0.19% | 0.07% | 0.05% | |
| CHF | 0.23% | 0.02% | 0.08% | -0.12% | 0.14% | 0.02% | -0.05% |
The table above illustrates the current exchange rates of major currencies compared to the US dollar. The leftmost column represents the base currency, while the top row shows the currencies being compared. For instance, if the base currency is the US dollar and you look at the Japanese yen column, the corresponding value indicates the dollar’s strength versus the yen.
