BlockBeats news, on September 19, the U.S. dollar is on track for its best weekly performance in three months, following signals from the Federal Reserve indicating further interest rate hikes. Supported by robust U.S. economic growth and the Fed’s firm stance on inflation following rate increases, the U.S. Dollar Index (DXY) rose approximately 1.1% this week.
Following the Federal Reserve's first interest rate hike in over three years, JPMorgan, Standard Chartered, and Brown Brothers Harriman all believe the decision removed the biggest obstacle to a stronger dollar. The U.S. Dollar Index traded near its 200-day moving average on Wednesday and Thursday, then slightly broke above this key level on Friday. Historical data shows that when the daily closing price of the U.S. Dollar Index surpasses its 200-day moving average, the dollar tends to continue rising.
Previously, in March and June, the index showed further strength after breaking above the 200-day moving average. The U.S. Dollar Index gave back some of its weekly gains as the yen pared its losses following reports that the Bank of Japan conducted a "currency check." The index had been on track to record its largest weekly gain since the outbreak of the Iran war in March. A Bank of Japan currency check is typically viewed as a precursor to official intervention.