Fundamental Factors Affecting the Trend of the U.S. Dollar

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After a series of downward Eastforexcashback rebound cashback forexg fluctuations in recent years, the U.S. cashbackforexbtc forexcashbackcalculator now entering a more delicate period when the direction of the U.S. dollar is uncertain, and it is difficult for investors to accu East forex cashbackly grasp investment opportunities. The Federal Open Market Committee is mainly responsible for setting monetary policy, including the announcement of key interest rate adjustments eight times a year, and its 12 members consist of government officials, the president of the Federal Reserve Bank of New York and the local U.S. Treasury Department, which is responsible for issuing U.S. government bonds and developing the fiscal budget. The federal funds rate, which is the most important interest rate indicator in the U.S. and the overnight lending rate among savings institutions When the Fed wishes to express a clear monetary policy signal to the market, it announces an adjustment in interest rates, which causes greater volatility in the stock, bond and money markets In addition, the price of the federal funds rate futures contract directly reflects the markets expectations of that rate The discount rate, which is Although it is a symbolic interest rate indicator, changes in it can sometimes send a strong policy signal The discount rate is generally less than the federal funds rate The 30-year Treasury bill, also known as long-term bonds, is the markets most important indicator of inflation A decline in bond prices due to inflation, i.e., a rise in yields, could put pressure on the dollar today With the implementation of the U.S. Treasurys "Borrow New, Pay Old" program, the 30-year Treasury note has gradually given way to the 10-year Treasury note as a benchmark. When inflation is not a threat to the economy, strong economic indicators will support the dollar exchange rate When inflation is a more obvious threat to the economy, strong economic indicators will depress the dollar exchange rate In addition, financial or political turmoil in emerging markets will also push up the price of dollar assets, when dollar assets, as a hedge, will indirectly push up the dollar exchange rate Eurodollar, which is the dollar deposits deposited in banks outside the United States, the spread can be used as a valuable benchmark for assessing foreign exchange rates For example, the greater the positive difference between the European dollar and European yen deposit rates, the more likely the dollar-yen exchange rate will be supported by the U.S. stock market, the three most important stock indices: the Dow Jones Industrial Average, the S&P 500 and the Nasdaq, while the Dow Jones Industrial Average has the greatest impact on the dollar exchange rate and shows a high positive correlation

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