US dollar fails to hold to gain as US stocks soar

The US Dollar index, which gauges the US dollar against its main competitors, lost momentum during the American session and erased gains. The index is trading near daily lows at 95.20, marginally below Wednesday’s closing price.

Two times during the day, the DXY rose toward the 95.50 area but both times failed to break higher. That area become a key short-term resistance. Near the end of the session it is moving toward daily lows that lie slightly above 95.00 as equity prices rise in Wall Street.

The Dow Jones index was up by 203 points or 1.10%  at 18,240 while the technological index, Nasdaq was rising 1.49%. Among commodities crude oil was up by 1.0% while gold was falling 0.50%.

US data lowers Fed rate hike expectations

Greenback is lower against most of the currencies weakened after the release of US economic data. Retail sales for August contracted more than expected, while industrial production dropped 0.4% (vs -0.3% expected). Also wholesale inflation showed lower than expected numbers. On the other sider, initial jobless claims (206K vs 265K) and the Philly Fed Manufacturing Survey (12.8 vs 1.0) offered above consensus numbers. On Friday, CPI data and consumer confidence will be released.