US Dollar Index firm above 97.00, consolidates weekly gains

• US dollar rises on Friday against European currencies, falls versus commodity and Emerging market currencies. 
• DXY post fourth consecutive daily gain.

The greenback posted mixed results on Friday, but measured by the US Dollar Index rose on the back of an appreciation against European currencies. 

The Index peaked at 97.33, the highest level since March 11 and then pulled back finding support at 97.00 after a soft reading of the PCE core. Then started to move to the upside boosted by the rejection at the UK Parliament of PM May’s Brexit deal and also by US new home sales and consumer confidence numbers. 

Near the end of the week, it is hovering around 97.20/25, up for the fourth-day in-a-row, extending the rally that started last week. 

Despite the Fed’s shift to a dovish stance and to a pause in the rate hike path, the DXY is about to end the month with a gain of 1.10%. Risk aversion, Brexit uncertainty and also the change in the ECB tone supported the greenback. 

Week ahead 

The key data next week in the US will the official employment report to be released on Friday. Market consensus point to an increase in payrolls of 175K. Also, the ISM manufacturing index, retail sales, and durable goods orders are due. The Brexit drama will continue next week and also speculations about the ongoing trade negotiations between the US-China.