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US Dollar Index Decreased before Major US Economic Releases

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May. 30 2018, Published 7:45 a.m. ET

US Dollar Index

The US Dollar Index started this week on a stable note and surged to the highest levels traded since November 7, 2017, on Tuesday. On May 30, the US Dollar Index opened the day on a mixed note. The US Dollar Index was trading below opening prices in the early hours.

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Market sentiment

The US Dollar Index surged on Tuesday. The political turmoil in Italy increased the demand for the safe-haven assets like the US dollar. However, the US Dollar Index started to pull back in the early hours on Wednesday amid profit-booking ahead of major economic releases. The releases include May’s US ADP non-farm employment change, the first quarter US GDP, and April’s US goods trade balance data. The data are scheduled to be released today. The market expects the ADP non-farm employment change to increase by 186,000. The data are scheduled to be released at 8:15 AM EST today.

At 5:20 AM EST on May 30, the US Dollar Index was trading at 94.46—a drop of 0.39%.

US Treasury yields

After a sharp decline to seven-week low price levels on Tuesday amid political turmoil in Italy, the ten-year US Treasury yield started to rebound in the early hours on Wednesday. The rebound in Italian equity markets and a pullback in US bonds are supporting the yields’ recovery in the early hours.

Below are the movements in Treasury yields as of 5:25 AM EST on May 30.

  • The ten-year Treasury yield was trading at 2.842—a gain of ~2.7%.
  • The 30-year Treasury yield was trading at 3.025—a gain of ~1.9%.
  • The five-year Treasury yield was trading at 2.668—a gain of ~3.6%.
  • The two-year Treasury yield was trading at 2.391—a gain of ~3.1%.

The iShares 20+ Year Treasury Bond (TLT) gained 2.2%, while the ProShares UltraShort 20+ Year Treasury (TBT) and the ProShares UltraPro Short 20+ Year Treasury (TTT) declined 4.3% and 6.4%, respectively, on Tuesday.

Next, we’ll discuss how commodities performed in the early hours on May 30.

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