The dollar index (DXY00) today gave up an early advance and is little changed. The dollar is slightly lower today after the Nov MNI Chicago PMI posted a 17-month low. Also, strength in stocks today has curbed liquidity demand for the dollar. The dollar initially moved higher today on better-than-expected US economic news, with weekly jobless claims unexpectedly falling to a 7-month low and Sep capital goods new orders rising more than expected. Also, higher T-note yields today have strengthened the dollar's interest rate differentials.
The dollar is also under pressure after Bloomberg reported that Kevin Hassett is leading as the potential next US Fed Chair to replace Jerome Powell. Hassett's nomination would be bearish for the dollar as he is seen as a dovish candidate. Also, Fed independence would come into question, as Hassett supports President Trump's approach to cutting interest rates at the Fed, which Trump has long sought to control.
