Surging US dollar index puts global currencies under pressure ahead of anticipated Powell address

Quick Take

The U.S. Dollar Index (DXY) has surged to break past the 104 mark, a level not witnessed in the last eleven weeks, according to Trading Economics, painting a picture of sustained strength in the U.S. dollar.

This marks the sixth consecutive week of advances for the DXY index, indicating its robust performance amidst economic uncertainties. Today’s spotlight, however, is set on the onset of the high-profile Jackson Hole meeting.

All eyes are honed in on Jerome Powell, the Federal Reserve Chairman, who is anticipated to provide crucial insights into his economic outlook.

A prevailing market expectation hints at the potential for rates to stay elevated longer. The coupling of the DXY’s uptrend with Powell’s upcoming address could significantly influence the future trajectory of the dollar and the larger global economic landscape.

The DXY index strength has put pressure on all major currencies, as Bitcoin hovers around $26,000 while the GBPUSD (1.25) and EUR (1.07), in particular, continue to break down.

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