The dollar index (DXY00) today is down by -0.89%. The dollar is under pressure today after President Trump refrained from imposing new tariffs on Asian and European goods on his first day in office. Also, today’s decline in T-note yields weakened the dollar’s interest rate differentials and weighed on the dollar. In addition, today’s stock rally has curbed liquidity demand for the dollar.
The markets are discounting the chances at 1% for a -25 bp rate cut at the January 28-29 FOMC meeting.
