Dollar Index posts best week since March

• DXY up 1.15% over the week, best since March 
• US data, yields, and Fed expectations push USD higher
• Another record high week for Wall Street 

The greenback ended the week higher in the market while AUD, CAD and EUR were the majors with the worst performance. 

DXY makes decisive breakout

The US Dollar Index broke on Thursday after the ECB meeting the 94.00 barrier that limited the upside several times since July. It continued to rise on Friday and peaked at 95.02, the highest since mid-July after the release of US GDP data. Real GDP grew at a 3% (annualized rate) above the 2.5% of market consensus. 

During the American session pulled back amid a recovery in Treasury bonds. The DXY was about to end the week hovering around 94.75, far from day’s highs but with a weekly gain of more than 1%. In Wall Street, equity prices continue with the uptrend. The Dow Jones was about to post the seventh weekly gain in row. 

Week Ahead 

The economic calendar shows a busy week ahead in the US. Main releases include personal income and spending (Monday), ADP, ISM (Wednesday) and NFP (Friday). Also, the two-day FOMC meeting will take place. Fed’s decision on Wednesday is expected to contain no surprises. The most relevant event regarding the US central bank will the announcement of the next Fed Chair.

The economic reports, the FOMC meeting and the nomination of the next chair will likely keep the US dollar volatile over the week.