Created
: 2025.09.26
- English
- English
- What's Myforex
- Share
- Use tools
- Get information
- What's New
- Help center
- About us
- Customer support
- Terms and policies
-
-
PortfolioShare your portfolio and performance in real time -
Events & contestsEvents and contests held by retail brokers around the world
-
-
Real-time spread comparisonCompare spreads of major retail brokers in real time -
Volatility analysisVisualize volatility as a measure of daily market activity -
Swap point comparisonCompare buy and sell swap values for each broker by symbol -
Market rates & chartsCheck prices for all instruments offered by each broker -
IndicatorsProviding in-house developed indicators for MT4/MT5 -
Trading calculatorsCalculation tools for each broker to help you trade
-
-
World FX newsLatest news on forex and cryptocurrencies from around the world -
Broker informationTrading information of retail brokers worldwide -
MetaTrader4/5 user guideUser guide collection for the latest MetaTrader4/5 -
Economic calendarRelease calendar for indicators from official sources of major economies
US Dollar Index posts modest gains to near 98.50, US PCE inflation data looms
World FX news
Breaking news
US Dollar Index posts modest gains to near 98.50, US PCE inflation data looms
2025.09.26 10:35
2025.09.26 10:35
- US Dollar Index gains ground to near 98.40 in Friday's early Asian session.
- The US economy grew at a 3.8% rate in Q2; Initial Jobless Claims tumbled to 218,000 last week.
- The US August PCE inflation report will be the highlight later on Friday.
The US Dollar Index (DXY), an index of the value of the US Dollar (USD) measured against a basket of six world currencies, trades on a stronger note around 98.40 during the Asian trading hours on Friday. The DXY extends the rally to near a three-week high as stronger US economic data would likely restrain the future interest rate cuts by the Federal Reserve (Fed).
The US Gross Domestic Product (GDP) expanded at an annual rate of 3.8% in the second quarter (Q2), the US Bureau of Economic Analysis (BEA) final estimate showed on Thursday. This reading came in stronger than the previous estimate and the expectation of 3.3%. The US Dollar (USD) attracts some buyers in an immediate reaction to the encouraging US economic data.
Additionally, the US Initial Jobless Claims for the week ending September 20 declined to 218K, compared to the previous reading of 232K (revised from 231K) and below the market consensus of 235K.
Traders will assess mixed signals from Fed policymakers. Kansas City Fed President Jeffrey Schmid said the rate cut was needed to help ensure that the job market remains in a good place. Chicago Fed President Austan Goolsbee noted that he was not eager to do a lot more policy easing while inflation is above target and moving the wrong way.
Financial markets are now pricing in nearly a 43 basis points (bps) of rate cuts in the remaining two policy meetings this year, although rexmarks from policymakers indicated that the decision will depend on the upcoming inflation and labour data.
Looking ahead, traders will closely monitor the US PCE inflation data later on Friday. The headline US PCE is expected to show an increase of 2.7% YoY in August, while the core PCE is projected to show a rise of 2.9% during the same period. Any signs of softer inflation could strengthen the case for Fed rate cuts and drag the DXY lower.
US Dollar FAQs
The US Dollar (USD) is the official currency of the United States of America, and the 'de facto' currency of a significant number of other countries where it is found in circulation alongside local notes. It is the most heavily traded currency in the world, accounting for over 88% of all global foreign exchange turnover, or an average of $6.6 trillion in transactions per day, according to data from 2022. Following the second world war, the USD took over from the British Pound as the world's reserve currency. For most of its history, the US Dollar was backed by Gold, until the Bretton Woods Agreement in 1971 when the Gold Standard went away.
The most important single factor impacting on the value of the US Dollar is monetary policy, which is shaped by the Federal Reserve (Fed). The Fed has two mandates: to achieve price stability (control inflation) and foster full employment. Its primary tool to achieve these two goals is by adjusting interest rates. When prices are rising too quickly and inflation is above the Fed's 2% target, the Fed will raise rates, which helps the USD value. When inflation falls below 2% or the Unemployment Rate is too high, the Fed may lower interest rates, which weighs on the Greenback.
In extreme situations, the Federal Reserve can also print more Dollars and enact quantitative easing (QE). QE is the process by which the Fed substantially increases the flow of credit in a stuck financial system. It is a non-standard policy measure used when credit has dried up because banks will not lend to each other (out of the fear of counterparty default). It is a last resort when simply lowering interest rates is unlikely to achieve the necessary result. It was the Fed's weapon of choice to combat the credit crunch that occurred during the Great Financial Crisis in 2008. It involves the Fed printing more Dollars and using them to buy US government bonds predominantly from financial institutions. QE usually leads to a weaker US Dollar.
Quantitative tightening (QT) is the reverse process whereby the Federal Reserve stops buying bonds from financial institutions and does not reinvest the principal from the bonds it holds maturing in new purchases. It is usually positive for the US Dollar.
Last updated
: 2025.09.26
Related articles
FX Today: Attention remains on US-China trade and US shutdown
2025.10.23 03:34USD/CHF steadies on trade optimism, Swiss deflation pressures
2025.10.23 02:05AUD/USD rises modestly on trade optimism as eyes turn to PMI, US inflation
2025.10.23 00:53EUR/USD Price Forecast: Euro finds footing as US Dollar slips from one-week highs
2025.10.23 00:52GBP/USD steady near 1.3360 post soft UK CPI
2025.10.23 00:47EUR/JPY steadies near 176.00 as Japan's stimulus and BoJ-ECB divergence weigh
2025.10.22 23:38
FXStreet is a forex information website, delivering market analysis and news articles 24/7.
It features a number of articles contributed by well-known analysts, in addition to the ones by its editorial team.
Founded in 2000 by Francesc Riverola, a Spanish economist, it has grown to become a world-renowned information website.
Was this article helpful?
We hope you find this article useful. Any comments or suggestions will be greatly appreciated.
We are also looking for writers with extensive experience in forex and crypto to join us.
please contact us at [email protected].
Thank you for your feedback.
Thank you for your feedback.
Most viewed
Dow Jones Industrial Average drops as fresh trade fears rattles markets
The Dow Jones Industrial Average (DJIA) struggled on Wednesday, declining a little over 500 points at its lowest point on the day.
New
2025.10.23 04:01FX Today: Attention remains on US-China trade and US shutdown
The US Dollar (USD) snapped a multi-day positive run, coming under renewed downside pressure after hitting fresh weekly highs amid somewhat mitigated concerns on the US-China trade front, while the lack of news surrounding a deal to end the US federal government shutdown continued to prevail.
New
2025.10.23 03:34WTI gains traction amid surprise US inventory draw and weaker Greenback
West Texas Intermediate (WTI) Crude Oil edges higher on Wednesday, extending gains for the second consecutive session as traders react to a surprise draw in US inventories.
New
2025.10.23 03:19Gold extends losses ahead of key US inflation report
Gold price slides over 1.50% on Wednesday after plummeting more than 5% on Tuesday in its biggest daily loss in five years as traders brace for the release of the latest inflation report in the United States (US). At the time of writing, XAU/USD trades at $4,050 after reaching a high of $4,161.
New
2025.10.23 03:06USD/CHF steadies on trade optimism, Swiss deflation pressures
The USD/CHF pair is down 0.10% on Wednesday, trading around 0.7950 at the time of writing, after bouncing from the 0.7900 area earlier this week.
New
2025.10.23 02:05AUD/USD rises modestly on trade optimism as eyes turn to PMI, US inflation
AUD/USD trades slightly higher around 0.6500 on Wednesday at the time of writing, up about 0.10% for the day. The pair benefits from a renewed risk-on mood, as investors welcome more constructive signals on the trade front between the United States (US) and China.
New
2025.10.23 00:53EUR/USD Price Forecast: Euro finds footing as US Dollar slips from one-week highs
The Euro (EUR) edges higher against the US Dollar (USD) on Wednesday, snapping a three-day losing streak as the Greenback loses momentum. At the time of writing, EUR/USD is trading around 1.1611, bouncing off the intraday low near 1.1576.
New
2025.10.23 00:52GBP/USD steady near 1.3360 post soft UK CPI
GBP/USD holds firm during the North American session after the latest inflation report in the Great Britain, triggered some weakness on Sterling as expectations for further easing by the Bank of England, increased. The pair trades at 1.3362 virtually unchanged after diving to 1.3305 post CPI data.
New
2025.10.23 00:47EUR/JPY steadies near 176.00 as Japan's stimulus and BoJ-ECB divergence weigh
The Euro (EUR) steadies against the Japanese Yen (JPY) on Wednesday, trading around 176.26 after snapping a four-day losing streak on Tuesday.
New
2025.10.22 23:38EUR/CHF rebounds from 11-month low amid ECB, SNB policy signals
The Euro (EUR) steadies against the Swiss Franc (CHF) on Wednesday, recovering after briefly hitting an 11-month low near 0.9205 on Tuesday. At the time of writing, EUR/CHF trades around 0.9240, as the Euro stages a mild technical rebound from oversold conditions.
New
2025.10.22 22:32Disclaimer:
All information and content provided on this website is provided for informational purposes only and is not intended to solicit any investment. Although all efforts are made in order to ensure that the information is correct, no guarantee is provided for the accuracy of any content on this website. Any decision made shall be the responsibility of the investor and Myforex does not take any responsibility whatsoever regarding the use of any information provided herein.
The content provided on this website belongs to Myforex and, where stated, the relevant licensors. All rights are reserved by Myforex and the relevant licensors, and no content of this website, whether in full or in part, shall be copied or displayed elsewhere without the explicit written permission of the relevant copyright holder. If you wish to use any part of the content provided on this website, please ensure that you contact Myforex.
Myforex uses cookies to improve the convenience and functionality of this website. This website may include cookies not only by us but also by third parties (advertisers, log analysts, etc.) for the purpose of tracking the activities of users. Cookie policy
