Dollar Index Gets a Tiny Shake‑Up
Yesterday’s rally nudged the U.S. Dollar Index (DXY) back up to about 103.20 points, after a last‑week crash that had us all sweating.
What’s the engine behind the bounce?
- Job numbers are cooling—so the U.S. labor market is softening, giving the market a breather.
- The Federal Reserve is in blackout mode (no speeches) until next week’s rate decision.
Tuesday’s Cook‑Book: CPI, PPI, Retail Sales
The real drama unfolds in those three data releases. The Consumer Price Index (CPI) surprised us by rising more than analysts feared—an unexpected inflation bump that might keep the Fed from cutting rates any time soon. Below are the pieces of the puzzle:
- CPI – higher than expected.
- PPI – to be released Thursday, will tell us about future pricing pressure.
- Retail Sales – late Thursday, a barometer for consumer confidence.
Trump’s Tariff “Idea” & Market Turbidity
“Give it a 10% tariff,” Trump said in a tweet; this kind of rhetoric keeps markets jittery, especially when it threatens to bring jobs back on a “back‑to‑America” sprint.
Geopolitics & Ramadan: Headaches for the Globe
Naval maneuvers by China, Iran, and Russia from March 11‑15 keep tensions simmering. In Gaza, Ramadan means a scarcity of supplies, creating volatility that the market sees as a safe‑haven sausage.
Portugal’s Right Turn & Europe’s Reaction
Unexpectedly swinging to the right in its elections, Portugal may set the stage for other European powers to adopt protectionist stances as the region heads into politically fraught elections.
Japan & The Markets: A Cautious Stroll
Japanese GDP simply nudged the country out of recession—no big fireworks, but confidence that rates may not rise. Meanwhile:
- European stocks nearly hit a 1% dip.
- U.S. indices slid by about 0.5%.
- Fed’s “hold” option is 96%—only a 4% chance of cuts.
Dollar’s Benefit & Interest Rates
With the Fed likely to maintain current rates, the Dollar Index is climbing—a clear sign that investors are leaning towards the green stuff. Meanwhile, the 10‑year Treasury yield is parked at roughly 4.05%, ticked down to its lowest in a week.
