SMM9 March 22: the dollar index has been falling since the beginning of the year due to factors such as US economic stimulus. The dollar index has been fluctuating at a low level for nearly two months, but it has rebounded sharply in the last two days. In the face of weaker global financial markets, money is more likely to return to the dollar cash market. At around 14:30 today, the dollar index refreshed its intraday high of 93.764, up 0.25%.
The rapid rebound in the US index was driven by market risk aversion. Yesterday, the US Treasury Department's financial crime enforcement network (FinCEN) released a series of confidential documents, which revealed that international well-known financial institutions such as Morgan Chase, Standard Chartered Bank and Deutsche Bank were suspected of money laundering. Explosive negative news quickly swept the global market, and European and American bank stocks tumbled last night, dragging down the stock market. At the same time, other financial sectors have also been affected. In this context, venture capital is quickly transferred to the dollar market to avoid risk. The second epidemic has once again caused panic in the market and strengthened the risk aversion force. European governments reiterated their caution, and British Prime Minister Johnson later publicly admitted that the second wave of the epidemic in Britain was inevitable, saying that the government would take stronger prevention and control measures to stop the outbreak.
In addition, the failure of a new US stimulus package may also contribute to the rise of the dollar. Republicans and Democrats have been deadlocked over a new stimulus package since July. The death of U.S. Supreme Court Justice Ruth Bud Ginsburg on the 18th may further make it more difficult to negotiate the stimulus package. Us media analysts say the death of Supreme Court Justice Ginsburg has led to more disputes between the two parties in Congress, which may make it more difficult to pass a new round of economic stimulus bills.
With the dollar strengthening and precious metals falling sharply, investors need to keep a close eye on the Fed's views on US economic and monetary policy. At 22:00 this evening, Chicago Federal Reserve Chairman Evans will deliver a speech on U.S. economic and monetary policy. 22:30, Federal Reserve Chairman Powell and US Treasury Secretary Nuchin gave testimony before the House Financial Services Committee.