The U.S. Dollar Index (DXY) was near 102 in Asian trading Monday, FXStreet reported, as September inflation and Iran diplomacy shaped competing pressures on the U.S. currency.
FXStreet said waning demand for the dollar’s safe-haven role was restraining it; the outlet also cited inflation and rate-hike expectations as offsetting forces. Intercontinental Exchange (ICE) says the index compares the dollar with six currencies through a real-time geometric calculation.
The Bureau of Economic Analysis (BEA) reported that the personal consumption expenditures (PCE) price index rose 0.5% from August and 3.6% from a year earlier in September, compared with increases of 0.3% and 3.4% in August. Core PCE advanced 0.3% month over month and 3.1% year over year, after increases of 0.3% and 3.0% in August.
The Federal Open Market Committee (FOMC) held its target range at 3.75% to 4.00% on Oct. 28. The 10-2 vote included two officials who favored a 0.25-percentage-point increase. The committee said, “Inflation remains elevated.” FXStreet reported roughly 75% odds of a December increase, citing CME FedWatch. CME says its probabilities are implied by 30-Day Federal Funds futures prices.
The Associated Press reported that, in an interview shared on his Telegram channel, Iranian Foreign Minister Abbas Araghchi said negotiators in Qatar were discussing a proposal that could reopen the Strait of Hormuz within two days if the United States met conditions. He also said there were no direct U.S.-Iran talks. Qatar’s Foreign Ministry said Oct. 27 that messages and proposals were continuing to pass between Washington and Tehran through Qatar’s mediation channel. EconoTimes previously covered a dollar-index move amid conflicting Iran reports.
The Institute for Supply Management scheduled its manufacturing PMI report for Monday, Nov. 2, at 10 a.m. ET and its services PMI report for Wednesday, Nov. 4, at 10 a.m. ET. The Bureau of Labor Statistics scheduled the October Employment Situation report for Friday, Nov. 6, at 8:30 a.m. ET. The FOMC’s next meeting is scheduled for Dec. 8-9.
