Dollar Index Struggles to Keep Up with Its Basket of Currencies

The Dollar Index (DXY) inched down on Friday after Central Bank underlined the growing concern of inflation and potential economic challenges by Omicron.

Dollar index is trading at 95.925 on Friday as it struggles to keep up its basket of currency pairs. The index is down by 0.12 %.

The yiled on 10-year U.S. benchmark is down to 1.417.

“Ordinarily, in the wake of a more hawkish FOMC outcome, yields would be expected to rise in anticipation of the Fed tightening cycle,” said analysts at Westpac in a morning note as by Reuters, referring to the Federal Open Market Committee, which sets monetary policy.

“However there are competing dynamics at present, with ongoing inflation fears sparking the Fed’s tougher rhetoric being offset by fears that economic growth will be derailed by omicron in the near term,” they said.