The US dollar index fell sharply during trading today on Tuesday, despite some positive US economic data, followed by consumer confidence data released a few hours ago. However, there are some developments that are weakening demand for the dollar. The most important of them are:

Euro’s strength pushes dollar index down

Given the importance of the euro currency in the relative weight of the US dollar index, which is 60% of the relative weight of the dollar index, and in light of the clear rise in the euro index during today’s trade due to optimistic reports about the need for the members of the European Central Bank to keep interest rates unchanged after a month’s meeting next July, especially During the September meeting, these optimistic and tightening statements in Europe had a clear negative impact on the dollar index.

Markets await statements from US Federal Reserve Chairman Jerome Powell

US Federal Reserve Governor Jerome Powell is scheduled to speak tomorrow at 1:30pm GMT, and currency markets will always closely monitor the governor’s statements as he provides hints or indications on the future of US monetary policy at upcoming bank meetings. The dollar has a strong influence on movements against other currencies, especially since market expectations are currently leaning towards raising interest rates during the next July meeting, but tomorrow’s reports may have another opinion, and this will scare investors into demand for the dollar.

Positive US economic data prevents a strong dollar from weakening

According to the US Consumer Confidence Index data released by the Conference Board on Tuesday, the US dollar gained support due to the release of some positive economic data led by consumer sentiment data which supported and strengthened market expectations of a hike in US interest rates. The index posted a more positive reading in June. According to the data, the US Consumer Confidence Index came in at around 109.7 points, which was higher than market expectations, which indicated that it would only get around 103.9 points.

How has the dollar index been affected by these developments?

In light of these developments and weaker demand for the US dollar, the dollar index fell by 0.20% to around 102.49 points, and new developments are expected to have a strong impact on trade in the coming days.