Dollar Finds Stability on Hawkish Fed Comments
The US dollar index stabilized on Tuesday after Atlanta Fed President Raphael Bostic said the central bank should maintain its restrictive policy stance until there is more evidence that inflation is on a sustainable path toward the 2% target.
Bostic's comments, which reinforced market expectations of a gradual easing cycle, supported the dollar and helped it recover from a one-week low. The dollar index hovered near 105.5 as of late Tuesday, with traders interpreting Bostic's remarks as a signal that the Fed will keep rates higher for longer.
The dollar's resilience comes despite recent softness in US economic indicators, including a slowdown in manufacturing activity and a slight uptick in jobless claims. The currency's strength is also supported by its safe-haven appeal amid geopolitical uncertainties and ongoing trade tensions.