The dollar index (DXY00) on Monday fell by -0.42%. Strength in the euro Monday weighed on the dollar as EUR/USD rose on hawkish comments from ECB Governing Council member Nagel, who said central banks may have to raise interest rates should international tensions intensify and lead to more significant inflationary pressures. The dollar extended its losses Monday after T-note yields gave up an early advance and turned lower, weakening the dollar’s interest rate differentials.
Monday’s unexpected increase in the US Nov NAHB housing market index to a 7-month high supported the dollar. Also, weakness in the Japanese yen boosted the dollar.
