Dollar index stays stubbornly firm at the start of the New Year extending gains from last year as the US fed signaled a more cautious approach on interest rate cuts for 2025. In 2024, the DXY added close to 7% annual gain. Indications of slower pace of rate cuts coupled with election of Donald Trump as the new president boosted the dollar as his policies of looser regulation, tax cuts, tariff hikes and tighter immigration are seen as both pro-growth and inflationary supported the greenback. US benchmark long term treasury yields are holding at 4.5% and dollar index that measures the greenback against a basket of currencies is quoting firmly at 108.19 but slightly lower on the day. US economic data, global growth, geo-political developments, central bank actions, Trump policies are all likely to provide onward direction for greenback in the year ahead. Among basket currencies, EURUSD and GBPUSD are slightly higher at $1.0396 and $1.2522 respectively.
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