Graphic Rewind: US Dollar Rises as FOMC Minutes Stick to Bernanke Playbook
- US Dollar Index rises to a weekly high
- The greenback popped higher on FOMC minutes
- AUD/USD drops 50 pips on disappointing Chinese PMI
A look back at the past 24 hours of Forex trading using movements in the US Dollar Index:
US Dollar 15-Minute 12:00 02/19 to 12:00 02/20 EST
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The Dow Jones FXCM US Dollar Index has risen for the fourth consecutive day and set a new weekly high at 10,594, as the FOMC confirmed its determination to continue to taper QE stimulus in measured steps.
The greenback index rallied nearly 20 points following the release of the minutes on Wednesday from the Fed’s January meeting. Chair Yellen had just testified before Congress last week, and the minutes did not stray from her pledge to continue to taper the monthly stimulus barring a notable change in the economic outlook. But the minutes were still hawkish enough (or not dovish enough) to cause a spike in dollar trading.
In overnight trading, the Australian Dollar fell fifty pips against its American counterpart, as HSBC announced its Chinese February Manufacturing PMI at 48.3, significantly disappointing expectations for 49.5. The US Dollar Index held onto the gains through the Tokyo session.
In NY trading on Thursday, the dollar index managed to trade fairly steady through the release of US inflation and the Markit preliminary PMI. The inflation gauge for January was released as expected, and the PMI beat expectations and sent the greenback only slightly higher.
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Charts created by Benjamin Spier using Marketscope 2.0
-- Written by Benjamin Spier, DailyFX Research. Feedback can be sent to firstname.lastname@example.org .
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.