The dollar index (DXY00) Thursday rose by +0.24% and posted a 2-week high. The dollar found support Thursday after US Nov PPI rose more than expected, which pushed T-note yields higher and is hawkish for Fed policy. Also, the weakness in the euro Thursday was supportive of the dollar after the ECB cut interest rates as expected, knocking the euro down to a 1-1/2 week low. Gains in the dollar were limited after weekly US jobless claims unexpectedly rose to an 8-week high, a sign of labor market weakness that is dovish for Fed policy.
US Nov PPI final demand rose +3.0% y/y, stronger than expectations of +2.6% y/y and the largest increase in 1-3/4 years. Also, Nov PPI ex-food and energy was unchanged from Oct at 3.4% y/y, stronger than expectations of +3.2% y/y.
