The dollar index (DXY) rose by +0.32% on Wednesday, supported by a +5 basis point increase in the 10-year T-note yield and a +4.6% rally in WTI crude oil prices. The US consumer price index (CPI) report showed a February rise of +0.3% month-over-month and +2.4% year-over-year, remaining above the Federal Reserve’s target rate of +2%.
WTI crude oil prices reached $119.48 following geopolitical tensions but settled around $87 per barrel after President Trump indicated an end to the ongoing conflict in Iran. Additionally, G-7 nations agreed to a release of 400 million barrels from strategic reserves, surpassing the 182 million barrels released in 2022.
In the foreign exchange market, EUR/USD fell by -0.35% due to dollar strength, while USD/JPY rose by +0.57%. Swaps markets currently indicate a 0% chance for a -25 basis point rate cut at the next Federal Open Market Committee meeting on March 17-18, with expectations for rate cuts in 2026.
