The dollar index (DXY00) is up by +0.17% today. The weakness in stocks today has boosted some liquidity demand for the dollar. Also, today’s report on the July Chicago Fed national activity index was stronger than expected, supportive of the dollar. Gains in the dollar are limited by today’s report from CNBC that said the Treasury could use the Treasury General Account, which had a balance of $935 billion on August 20, to fund expanded buybacks of higher-yielding, older government securities. Also, today’s decline in WTI crude oil by more than -1% lowers inflation expectations and is dovish for Fed policy.
The US July Chicago Fed national activity index fell -0.14 to -0.08, slightly stronger than expectations of -0.09.
