The US Dollar (USD) traded flat on Tuesday, as markets reacted to China’s stimulus measures, including a 500 billion Yuan liquidity injection. This prompted rallies in Asian equity markets, particularly in the Chinese Yuan (CNY), which gained 0.50% against the USD.
The US Dollar Index (DXY) remains stuck within a narrow September range as traders await more economic data. Key releases for the day include the Richmond Fed Manufacturing Index and a speech by Federal Reserve Governor Michelle Bowman on the US economy and monetary policy.
While US and European equities saw moderate gains following China’s stock surge, US Dollar traders remain cautious, with the DXY hovering between 101.90 and 100.62.
Geopolitical developments, such as the UN’s emergency meeting on Lebanon, may also affect market sentiment. The CME Fedwatch Tool shows mixed expectations for the Federal Reserve’s next move, with a 48.5% chance of a 25-basis-point rate cut in November.
Technically, the DXY faces resistance at 101.90, with support at 100.62. Further moves could see it testing levels around 99.58 if downward momentum continues.


