What are the reasons for the rise in the dollar after the release of inflation expectations?

U.S. dollar

Pointer saw dollar A significant increase during trading today, Friday, especially after the issuance of some economic data, on top of which is the issuance of inflation expectations. The following are the most important influences on the dollar’s ​​movements:

Positive economic data increases pressure on the dollar

The US dollar found strong support from the issuance of some economic data, on top of which was the US Producer Price Index data, as the US census data released today, Friday, showed the positivity of the US Producer Price Index data at the end of last November, as the index recorded a growth of about 0.3% during November, better than expectations. Markets expect the index to grow by only 0.2%. The previous reading of the index had recorded a growth of 0.2% during last October.

Also, the data released showed that the initial reading of the Consumer Confidence Index issued by the University of Michigan was positive and recorded 59.1 points during this December, compared to market expectations that it would score only about 56.9 points, and the previous reading for September had recorded about 56.8 points, and this was his A strong positive effect on the movements of the dollar.

The rise in US bond yields provides additional support for the dollar index

At the same time, the dollar is still receiving strong support from the rise in the yield of US bonds in its various terms, as the yield on 10-year bonds rose near the level of 3.545%, up by 1.50%. Also, the yield on 20-year bonds increased by 1.83%, reaching 3.7819%. At the same time, the yield on 30-year bonds stabilized, to record around 3.520%, up by 1.89%. This rise in bond yields was supportive of the US dollar’s movements against other currencies.

Fears of a global economic recession increase the demand for the dollar

Also, the US dollar found support from increasing fears about the global economic recession, as the Executive Director of the International Monetary Fund, Kristalina Georgieva, said today, Friday, that economic indicators revealed the possibility of global growth drifting towards a further slowdown, and indicated that China’s moves to reconsider restrictions The epidemic has a fruitful economic impact on both the local and global levels.

How was the US dollar index affected by these developments?

In light of these economic data positivity Within the United States, issued today, Friday, and the high demand for the dollar today, the dollar index has stabilized significantly, but it is still below the level of 105 points, as it is currently trading near the level of 104.85 points, and it is awaiting any new developments in the markets that may affect its trading.


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