US Dollar bounces off YTD lows, around 94.60

Another day, another drop of USD. This time the US Dollar Index (DXY), which tracks the buck vs. a basket of its main rivals, is navigating the area of fresh YTD lows in the mid-94.00s.

US Dollar depressed on ‘Trumpcare’ bill

The index lost further ground late on Monday after Republicans opposed to even start debating a freshly revised version of the American Health Care Act (‘Trumpcare’), slipping back to levels last seen in September 2016 in the mid-94.00s.

The focus of attention in US politics should now shift to the tax reform, although that road promises to be bumpy as well, keeping the buck under persistent pressure.

In addition, scepticism around the ability of the Federal Reserve to hike a third time later in the year stays on the rise among investors, particularly after the poor prints from US inflation figures and retail sales published on Friday. in fact, CME Group’s FedWatch tool now sees the probability of a rate hike at the December meeting at just above 45%.

In the US data space today, import prices are due followed by the NAHB index and TIC flows for the month of May.

US Dollar relevant levels

The index is losing 0.34% at 94.60 and a break below 94.51 (2017 low Jul.18) would open the door to 94.44 (low Sep.8 2016) and then 94.05 (low Aug.18 2016). On the upside, the next hurdle aligns at 95.41 (10-day sma) seconded by 95.61 (high Jul.14) and finally 95.96 (high Jul.11).