Ahead of the Feds FOMC meeting, the US dollar gained a foothold in the global markets trouncing leading commodities and local currencies. The US dollar’s DXY Index steadily climbed in the last 24 hours touching a high of 103.90 on Wednesday. The currency was at the 102 level early this month but sustainably scaled up in the charts. The development indicates that currency investors have not given up on the US dollar’s prospects.
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Simultaneously, gold prices dipped this week as the US dollar strengthened in the indices. Gold fell to the $2,150 level after sustainably scaling up in the charts for two weeks straight. The XAU/USD gold index had touched a new all-time high of $2,180 this month. Gold’s bullish sentiments are now paused as investors are looking to book profits in the currency markets.
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US Dollar Comes Out On Top of Gold & Local Currencies
Apart from gold, the US dollar is also outperforming local currencies in the foreign exchange markets. The US dollar trounced the Indian Rupee this month when the INR was trading at 82.80 two weeks ago. Today, the rupee dipped further reaching 83.09 as the USD gained strength against the currency.
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The strong resistance level for the US dollar stems after investors steadily purchased the USD during each dip this year. The move cemented the greenback’s resistance level leading it to bounce back stronger during the current upturn. Despite all odds, currency investors have not given up hope on the USD’s prospects and accumulated it at every level.
Another upward trajectory could push the US dollar beyond the 104 threshold. The positive swing could make gold prices and other local currencies experience a sharp dip in the global markets. In conclusion, the US dollar is responding positively ahead of the upcoming pre-FOMC meeting by the Federal Reserve.