U.S. Dollar Surges to Two-and-a-Half-Month High Amid Strong Economic Data
The dollar reached a two-and-a-half-month high last week, driven primarily by stronger-than-expected U.S. economic data. This suggests that the Federal Reserve is likely to implement only an additional 50 basis points in rate cuts this year—25 basis points in November and another 25 basis points in December. The Dollar Index benefited from robust reports on retail sales and jobless claims.
Additionally, the real rate (shown in the top chart) has been climbing since its mid-September low, with the dollar (depicted in the middle chart) following suit. The current correlation coefficient (illustrated in the bottom chart) between these two metrics stands at a strong 95%. As long as the economic data continues to support the real yield, this trend bodes well for the greenback.
Source: www.tradingview.com
Russell Shor
Senior Market Strategist
Russell Shor is a Senior Market Strategist at FXCM, having been promoted to the role in 2025 in recognition of his depth of insight and consistent delivery of high-impact market analysis. He originally joined FXCM in October 2017 as a Senior Market Specialist.
Russell holds an Honours Degree in Economics from the University of South Africa, is a certified FMVA®, and a full member of the Society of Technical Analysts (UK). With over 20 years of experience in financial markets, his work is renowned for its clarity, precision, and strategic value across asset classes.
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