US Dollar Index to see another spike high near 97.70 – ING

The world remains transfixed by war in Europe. The dollar has understandably been favoured this week, and economists at ING expect the US Dollar Index (DXY) to retest its highest level since June 2020 at 97.70.

Dollar liquidity will remain favoured

“Given the uncertainty, we suspect investors will want to hold on tight to their dollars. 

“FOMC members still seem happy to speculate over a 25bp or 50bp rate hike at the 16 March meeting. Here, the pricing of the Fed terminal rate (in two years) is just 5bp off its recent highs.”

“We continue to favour the dollar over Europe and favour the DXY returning to yesterday's spike high near 97.70.”