The dollar is poised for its largest weekly rise in three months after the Fed
signaled the prospect of further rate hikes. The DXY index has gained about 1.1%
this week, supported by resilient US growth and a hawkish post-hike stance
following the Fed’s first rate increase in more than three years. JPMorgan,
Standard Chartered and Brown Brothers Harriman said the decision removed the
main barrier to dollar strength. DXY consolidated near its 200-day moving
average on Wednesday and Thursday and ticked above that level on Friday;
historical daily closes above the 200-day MA in March and June preceded further
dollar gains. The dollar trimmed some weekly gains after the yen narrowed losses
on reports of a BANK OF JAPAN “currency check,” a step often viewed as a
precursor to official intervention.
