US Dollar Index traded near flat
The US Dollar Index measures the strength of the dollar against a basket of six currencies. It continued to strengthen steadily. This trend has been evident since November 13. The US Dollar Index was inching closer to the 100 mark. The index reached a high of 99.8 on November 17, 2015. It was trading in a narrow range of 99.4–99.8 the day before. It ended the day at 99.6. It rose slightly for the day. The inflation data came in according to the forecasts. The data added to the US dollar’s stability.
Consumer price index rose by 0.2%
The Bureau of Labor Statistics published the CPI (consumer price index) number for October on November 17, 2015. The month-over-month CPI came in according to the forecasts at 0.2%. The YoY (year-over-year) CPI was slightly above the forecasts at 0.2%. The strong rise in the CPI came after two months of negative inflation. It’s expected to be welcomed by the Fed officials. They will be meeting in mid-December to decide whether to increase the interest rates from the near-zero levels. The rise in energy prices was one of the major drivers of the rise in inflation. Gasoline prices rose by 0.4% in October compared to a fall of 9% in September.
Impact on the market
Regarding the ETFs, the PowerShares DB US Dollar Bullish ETF (UUP) rose by 0.15% on November 17, 2015. The WisdomTree Bloomberg US Dollar Bullish Fund ETF (USDU) includes developed economies as well as emerging market currencies. It rose by 0.17%.
The banking ADRs (American depositary receipts) were trading on a negative note on November 17, 2015. JPMorganChase (JPM) fell by 0.57% while Citigroup (C) fell by 0.37%. Wells Fargo (WFC) followed a similar trajectory. It ended lower by 0.56% for the day.