Forex Market Update: Dollar Index Up

By / / Hot Stocks to Watch, Forex


The U.S. dollar index remained near four-week high on Friday even as the trading volume was low due to month-end positioning and holiday season and concerns over any immediate U.S. military intervention in Syria eased somewhat.

The dollar index, which is a measure on U.S. unit’s performance against a basket of six major traded currencies, rose 0.13% to 82.11, at last check.

Still, the situation in the middle-east can get volatile. Although the British Parliament voted against any joint military intervention against Syria, the U.S. is still resolved to take unilateral military action against Bashar-al-Assad’s regime.

Speculators believe that lingering concerns over the middle-east will support the U.S. dollar in coming days.  Rising expectations that the Federal Reserve could soon announce the winding down of asset purchases is also likely to keep the U.S. dollar index near its four-week high against a basket of major currencies.

Equities and many currencies from emerging markets have been battered lately as investors are withdrawing money in hordes from riskier assets under assumption that the Fed will soon tighten up its monetary policy, which in turn will spike interest rates on treasuries.

“I think the dollar recovery trend remains in place, though we may see a pause over the next few days,” said Ian Stannard, head of European foreign exchange strategy at Morgan Stanley, according to Reuters.

“The underlying fundamental picture is still there and that comes down to a rise in global yields and a rise in the U.S. dollar that is still going to weigh on the more vulnerable currencies,” added Stannard.








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Post Written By: Ed Liston

Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing in his yacht.

Disclaimer: This article is for informational purposes only and does not constitute financial advice. We are not financial professionals. The authors and/or site operators may hold positions in the companies or assets mentioned. Always do your own research before making financial decisions.
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