US Dollar Index Forecast, News And Analysis - FXStreet

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US Dollar Index struggles near 98.00 as US-Venezuela tensions ease

The US Dollar Index, which measures the value of the US Dollar against six major currencies, is extending its losses for the second successive session and trading around 98.20 during the Asian hours on Tuesday. The Greenback struggles as concerns about a broader geopolitical escalation ease. Markets are largely brushing aside tensions between the United States and Venezuela.

Latest US Dollar Index News

1. US Dollar Index struggles near 98.00 as US-Venezuela tensions ease

   By Akhtar Faruqui | 04:08 GMT

2. USD tests pre-Christmas highs – Scotiabank

   By FXStreet Insights Team | Jan 05, 16:06 GMT

3. Fed’s Kashkari: Inflation is still too high

   By Agustin Wazne | Jan 05, 13:29 GMT

DXY Technical Overview

Fundamental Overview

Latest US Dollar Index Analysis

Latest US Dollar Index Analysis

Editors' picks

EUR/USD holds gains near 1.1750 ahead of German inflation data

EUR/USD clings to mild gains near 1.1750 in European trading on Tuesday, looking to build on Monday's solid bounce from the nearly four-week lows. A broadly weaker US Dollar and a positive risk tone support the pair ahead of the German preliminary inflation data for December.

GBP/USD hangs close to three-month highs near 1.3550

GBP/USD consolidates below three-month highs near 1.3570 in European trading hours on Tuesday. The bullish technical setup on the daily chart, combined with a softer US Dollar and improving risk sentiment, contributes to the latest leg north in the pair.

Gold stands firm near one-week high; seems poised to appreciate further

Gold sticks to modest intraday gains through the early European session and currently trades around the $4,465 area, just below a one-week high touched this Tuesday. The US military strikes in Venezuela, heightened political tensions between Saudi Arabia and the UAE, the unrest in Iran, and the protracted Russia-Ukraine war keep geopolitical risks in play.

Solana climbs above $137 as spot ETF demand accelerates

Solana price extends gains above $137 at the time of writing on Tuesday, up more than 7% in the previous week. Institutional demand for SOL continues to strengthen, as spot exchange-traded funds recorded positive flows of more than $16 million on Monday, marking the largest single-day inflow since mid-December.

Think ahead: 2026 in ten charts – Part one

2025 was chaotic. 2026 might be even more so, if this weekend’s drama is anything to go by. Sometime soon, the Supreme Court will rule on President Trump’s use of emergency powers to impose country‑level tariffs - and betting markets put the odds of him losing at 70–80%.

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Fed News & Analysis

FED News

1. AUD/USD Price Forecast: Makes an effort to hold breakout above 0.6700

   By Sagar Dua | 11 minutes ago

2. Pound Sterling gains on upbeat market mood

   By Sagar Dua | 22 minutes ago

3. Gold bulls hold edge near one-week top amid geopolitical risks, Fed rate cut bets

   By Haresh Menghani | 36 minutes ago

FED ANALYSIS

1. Financial system showing signs of strain

   By Mike Maharrey Jan 05, 22:34 GMT

2. The year ends with a dud

   By Chuck Butler Jan 05, 15:07 GMT

3. Think ahead: 2026 in ten charts – Part one

   By ING Global Economics Team Jan 05, 13:45 GMT

More about FED!

US DOLLAR INDEX

The US Dollar Index (DXY, USDX) measures the value of the United States Dollar relative to a basket of foreign currencies. It is a weighted geometric mean of the dollar’s value relative to the following select currencies: Euro (57.6% weight), Japanese Yen (13.6%), British Pound (11.9%), Canadian Dollar (9.1%), Swedish Krona (4.2%) and Swiss Franc (3.6%). The index started in 1973, following the dissolution of the Bretton Woods system, with a base value of 100.00. Values are relative to this base – for instance, a current reading of 99.800 would indicate that the dollar has depreciated by 0.2% since the start of the index.

While the Dollar Index is a geometrically weighted index rather than trade-weighted, it is concentrated in European currencies and excludes two of the US’ top trading partners, Mexico and China. As a result, it is primarily used as a speculative tool rather than by corporates or asset managers like mutual funds, insurance companies or endowments. Additionally, the geometric mean methodology artificially undervalues the USD over time.

US Dollar Index on Wikipedia

INFLUENTIAL ORGANIZATIONS AND ECONOMIC DATA FOR THE US DOLLAR INDEX

The Federal Reserve (Fed)

The Federal Reserve (Fed) is the central bank of the United States (US) and it has two main targets: to maintain the unemployment rate at its lowest possible levels and to keep inflation around 2%. The Federal Reserve System's structure is composed of the presidentially appointed Board of Governors and the partially appointed Federal Open Market Committee (FOMC). The FOMC organizes eight scheduled meetings in a year to review economic and financial conditions. It also determines the appropriate stance of monetary policy and assesses the risks to its long-run goals of price stability and sustainable economic growth. The FOMC Minutes, which are released by the Board of Governors of the Federal Reserve weeks after the latest meeting, are a guide to the future US interest-rate policy.

Fed official website, on X and Facebook

The US Government

The US Government and its Treasury Department impact the US Dollar Index. Events such as administration statements, budgets, new laws and regulations or fiscal policy can increase or decrease the value of the DXY.

US Gross Domestic Product

US Gross Domestic Product (GDP) refers to the total market value of all final goods and services produced in the United States. It serves as a gross measure of market activity, indicating the pace at which the nation's economy is growing or contracting. Generally, a high reading or better-than-expected number is considered positive for the Dollar Index, while a low reading is seen as negative.