The dollar index (DXY00) this morning is up by +0.71% at a 5-1/4 month high. The divergence between the Fed and ECB is boosting the dollar and undercutting the euro, with the Fed expected to delay interest rate cuts and the ECB expected to begin cutting rates in June. Also, hawkish comments today from Boston Fed President Collins supported the dollar when she said the strength of the US economy allows time for patience from the Fed. In addition, war jitters in the Middle East have hammered stocks today and increased liquidity demand for the dollar.
The US Mar import price index ex-petroleum was unchanged m/m, weaker than expectations of +0.1% m/m.
