The dollar index (DXY00) Tuesday rose by +0.48%. A slump in stocks Tuesday boosted liquidity demand for the dollar and pushed the dollar index higher. Also, weakness in the yuan was supportive for the dollar after weaker-than-expected Chinese trade news Tuesday knocked the yuan down to a 2-1/2 week low against the dollar.
Dovish Fed comments Tuesday from Philadelphia Fed President Harker were bearish for the dollar when he said, "Absent any alarming new data between now and mid-September, I believe we may be at the point where we can be patient and hold interest rates steady and let the monetary policy actions we have taken do their work."
