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Dollar Index Making New Highs


U.S. stock index futures declined yesterday after a report showed the annual rate of inflation in the U.S. hit a 31-year high at 6.2%.

Inflationary pressures in the global economy are broadening and remain a concern.

There are fears that inflation will stay high for longer-than-expected, which could force central banks to tighten credit policies sooner.

Countering the bearish inflation influence is the better than expected corporate earnings reports.


The U.S. dollar index advanced to its highest level since July of 2020. The larger than estimated increase in the U.S. consumer price index puts pressure on the Federal Reserve to tighten credit conditions, which in turn, is bullish for the U.S. dollar.

The Australian dollar is lower on news that the unemployment rate increased to 5.2% in October from 4.6% in September, which is more than the 4.7% expected by economists.

The Reserve Bank of Australia last week said it sees the unemployment rate at 5.0% in December before easing to 4.25% at the end of 2022, and to 4.0% a year later.


Increased expectations of an earlier tightening by the Federal Reserve pressured futures yesterday.

There is a strengthening case that central banks are behind the curve, meaning the U.S. Federal Reserve and other central banks will likely bring forward interest rate hikes.

There are no Federal Reserve speakers scheduled for today.

The 30-year Treasury bond futures are holding up well despite yesterday’s bearish U.S. consumer price index report.

Futures and options trading involve significant risk of loss and may not be suitable for everyone.  Therefore, carefully consider whether such trading is suitable for you in light of your financial condition.  The information and comments contained herein is provided by ADMIS and in no way should be construed to be information provided by ADM.  The author of this report did not have a financial interest in any of the contracts discussed in this report at the time the report was prepared.  The information provided is designed to assist in your analysis and evaluation of the futures and options markets.  However, any decisions you may make to buy, sell or hold a futures or options position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to ADMIS. Copyright ADM Investor Services, Inc.

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