USD Index: Returning back into the more normal 90-100 trading range as global inflation shock recedes – MUFG
The US Dollar Index (DXY) is returning to the 90-100 range, economists at MUFG Bank report.
DXY close to fully reversing the surge fuelled by the Fed’s dramatic hawkish shift last year
DXY fell back below the 100 level on Thursday for the first time since April 2022 and we are now close to fully reversing the USD surge fuelled by the Fed’s dramatic hawkish shift last year when central bank officials and investors realised the scale of the inflation shock at hand.
Over the last 10 years, DXY has tended to remain within a 90-100 range and we suspect we are returning back into that more normal trading range as the global inflation shock recedes.