The U.S. dollar index, which gauges the dollar’s strength to a basket of six major currencies, has increased by 4.6% so far this year and is currently trading close to where it was in early November. The index saw its largest weekly rise since September 2022 last week, up 1.7%. As investors become more certain that the Fed must maintain current interest rates for an extended period to prevent a possible spike in inflation. The consumer price data from last week was greater than anticipated, which supported the belief that investors had only factored in 50 basis points of interest rate by late Friday.
That opinion was supported by last week’s better-than-expected consumer price data, which indicated that as of late Friday, investors were only pricing in 50 basis points of interest rate cuts in 2024, down from 150 basis points at the beginning of the year.
Investors, however, feel…
