US Dollar struggles for direction, still above 90.00

• The index faded the post-NFP spike to tops near 90.40.
• US 10-year yields regained the 2.90% handle and above.
• US economy added more than 300K jobs during February.

The US Dollar Index (DXY) – which gauges the buck vs. a basket of its main competitors – has faded the earlier bull run to session peaks near 90.40 and returned to the 90.20 area.

US Dollar looks for direction above 90.00

The index climbed as high as the 90.40 area in the wake of auspicious prints from US Non-farm Payrolls for the month of February (313K), although bulls failed to sustain the up move afterwards.

The strong jobs creation reinforced the view of a solid labour market, something that it is already vox populi and somewhat priced in. However, the demand for USD stays cautious, as results from Average Hourly Earnings – a proxy for wage inflation – are showing that inflationary pressures remain contained.

In addition, yields of the key US 10-year noted moved up and tested daily highs above the critical 2.90% milestone.

Earlier in the session, Chicago Fed C.Evans (2019 voter, centrist) said US labour market is not yet morphing into wage pressures, while he defended fiscal stimulus in its role of strengthening the economy.

US Dollar relevant levels

As of writing the index is losing 0.06% at 90.07 and a break below 89.43 (low Mar.7) would open the door to 88.44 (low Jan.26) and finally 88.25 (2018 low Feb.16). On the other hand, the next hurdle lies at 90.57 (high Feb.8) seconded by 90.93 (high Mar.1) and finally 91.00 (high Jan.18).