US Dollar Index remains under pressure below 90.00 ahead of data

DXY loses the grip further and slips back below 90.00.
US 10-year yields edge higher and surpass 1.60%.
ISM Manufacturing, final Markit Manufacturing PMI next on tap.
The greenback, when gauged by the US Dollar Index (DXY), loses further momentum and breaches the key support at 90.00 the figure.

US Dollar Index now focuses on data
The index adds to Monday’s retracement below the 90.00 yardstick amidst a generalized side-lined theme within the global markets and therefore the gradual return to the traditional activity within the US following the Memorial Day holiday.

The move lower within the dollar comes despite the bounce in US 10-year yields to the vicinity of the 1.62%, while the 10y-2y yield spread continues to play against dollar strength.

Later within the US data space, the ISM Manufacturing for the month of May will take centre stage seconded by the ultimate reading of the Markit’s Manufacturing PMI. Additionally, the IBD/TIPP Index is additionally due along side the Dallas Fed Index and therefore the speech by FOMC’s L.Brainard (permanent voter, dovish).

What to seem for around USD
The index stays depressed below the 90.00 neighbourhood amidst the noticeable absence of catalysts. watching the broader scenario, the negative stance on the dollar seems to prevail among market participants, as speculation of upper inflation within the medium-term now looks to possess lost momentum and therefore the US economic outperformance narrative seems almost fully priced in. Bolstering the bearish view on the buck emerges further confirmation of the Fed’s mega-accommodative stance for the foreseeable future, as per recent FOMC Minutes and Fed-speakers.


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