DXY APPROACHES 101.80 AS HAWKISH FED SIGNALS SUPPORT USD
The US Dollar continues to strengthen against major currencies, with the US Dollar Index (DXY) trading near 101.60, close to its yearly high of 101.80. The move has been supported by a firmer Federal Reserve policy outlook and expectations for continued restrictive monetary conditions.
Federal Reserve Bank of Minneapolis President Neel Kashkari highlighted concerns that inflation remains elevated while the US economy continues to show resilience. His comments reinforced expectations that the Fed may maintain a cautious approach toward future rate decisions.
According to the FedWatch Tool cited in the source, markets continue to monitor the possibility of further Federal Reserve rate increases. The latest Fed communication has kept interest-rate expectations as an important driver for the US Dollar.
Market attention now turns to key US economic releases, including the September ISM Manufacturing PMI and Nonfarm Payrolls (NFP) data. The ISM Manufacturing PMI is expected to be 55.0, slightly above the previous reading of 54.6. Recent private-sector employment data also showed stronger-than-expected job creation, keeping focus on labor market conditions.
From a technical perspective, DXY maintains a positive near-term bias while trading above the 20-day EMA near 100.53. The RSI (14) at 73.32 indicates strong momentum but also shows that the index is approaching overbought conditions.
The 101.80 yearly high remains the next key resistance area. On the downside, the 20-day EMA, near 100.53, remains an important support level, while the 101.00–100.50 region may be monitored as a key technical area.
For market participants, the key factors remain Fed policy expectations, US ISM PMI data, NFP employment data, US Treasury yields, DXY momentum and the 100.53–101.80 technical range, which may provide further direction for the US Dollar.
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