DXY: Dollar Index Has Been Pumping for 8 Days Straight. Inflation Report Is Up Next.

Greenback will be tested by September’s consumer price index report, expected to show inflation continuing to descend toward the Fed’s 2% goal.

• The US dollar index DXY is pressing hard to the upside. Continuing a powerful streak from last week, the greenback has rallied further, closing its eighth straight day in the green on Wednesday. The gauge, measuring the dollar’s strength against six rival forex players, shot up to levels of just under 103.00 yesterday before paring back some of the gains to float around 102.80 early Thursday.
• Little has been able to stand in the dollar’s way. New fuel was poured in on Friday when the US released its nonfarm payrolls data, showing a monster 254,000 jobs added in September. Now, as the dollar is approaching a fresh three-month high, inflation data scheduled for release today might either boost the buck’s valuation across the board or douse out the hot rally, depending on what the figure shows.
• September’s consumer price index is expected to show price growth moderated further to the downside at 2.3%, from 2.5% in August. If materialized, the readout will be ever closer to the Federal Reserve’s 2% goal. The Fed also just released its minutes from the meeting three weeks ago, which showed that policymakers were divided on whether to cut interest rates by a jumbo-sized half point.