Stronger-than-expected U.S. economic data fuels Fed rate hikes

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The U.S. dollar index DXY rose slightly, extending yesterday’s gains after stronger-than-expected U.S. economic data, including durable goods orders, new home sales and the Conference Board’s consumer confidence index. Lee Hardman, senior currency analyst at MUFG, said the data showed resilience amid the negative impact of higher interest rates and tighter credit conditions in the near term, which should keep the Fed raising rates. “The surprise strength of these data was the largest since early April, allowing the Fed to deliver at least one of two additional rate hikes in July,” he said.