The dollar index (DXY00) on Tuesday rose by +0.49%. The dollar on Tuesday recovered from a 1-week low and is moderately higher. Weakness in stocks on Tuesday boosted the liquidity demand for the dollar. The dollar Tuesday initially posted moderate losses after T-note yields fell and on signs of reduced dollar demand. The central banks of the BOE, ECB, BOJ, and Fed announced in a joint announcement that the frequency of 7-day U.S. dollar liquidity-providing operations will revert from daily to once per week beginning May 1. Central banks unveiled daily dollar operations last month to boost dollar liquidity after the run on Silicon Valley Bank and other lending institutions.
Tuesday’s U.S. economic news was mixed for the dollar. On the bullish side, Feb S&P CoreLogic composite-20 home price index unexpectedly rose +0.36% y/y versus expectations for a -0.05% y/y decline. Also, Mar new home sales unexpectedly rose +9.6% m/m to a 1-year high of 683,000, stronger than expectations of a decline to 632,000.
