Dollar Index Adds Strength On Hawkish Fed Views; US PCE Eyed

Published on May 29, 2024 11:37

The US dollar added strength on Wednesday amid a continued hawkish stance from Fed officials that reduced bets of a near term rate cut. Minneapolis Fed President Neel Kashkari stated in an interview that the Fed should delay cutting rates until inflation significantly improves and might even hike rates if inflation fails to come down further. Investors now await US PCE data for further cues. Meanwhile, data on Tuesday showed that US consumer confidence and housing sector unexpectedly improved in May, bolstering a hawkish outlook on Fed policy. The dollar index futures climbed to 104.65, up 0.10% on the day. US benchmark treasury yields are also higher at 4.56%. Among the basket currencies, EURUSD and GBPUSD are staying subdued mirroring dollar strength at $1.0855 and $1.2751 respectively.