DXY: US Dollar Slides Across Forex Board as Cool April Inflation Triggers Run for Risk Assets

Dollar index dropped about 1% Wednesday as traders rushed to dump greenback for pretty much anything else.

• The dollar index DXY dropped sharply on Wednesday after traders reacted to the latest inflation data out of the US. The gauge, measuring the dollar’s strength against six rival currencies, fell about 1% from 105.04 to levels near 104.20 in what turned out to be the third straight losing session. The dollar has been in a steady decline this month, erasing about 3% of its valuation.
• The consumer price index, or CPI for short, retreated to 3.4% in April, a tad lower than the 3.5% in March. But it was enough to boost investor confidence that the Federal Reserve will factor this drop in when outlining the path of interest rates for the rest of the year. Lowering price pressures rekindled hopes of lowering interest rates. And it showed across markets broadly.
• The EUR/USD pair rocketed by 1% to trade near $1.09. Gold prices jumped to levels near $2,400 per ounce. Bitcoin advanced a solid 8% to cross $66,000 per token. And stock indexes soared to record highs all thanks to a slight tick in an economic report. What’s notable about this decline in prices is that it was the first one this year after prices grew in each of the previous four months.