DXY reached our 105 target overnight…and is still dropping.
While this reflects the sharp drop in interest rates (thank you equity correction), the US is still a net importer. So a drop in the value of the dollar means higher inflation. Not exactly a good look when folks are justifiably worried about stagflation.
Speaking of which, the ADP jobs report was plenty ugly this morning: +77K versus 145K consensus and 186K prior.
There aren’t many companies that enjoy the kind of chaos that characterize the early days of Trump’s second term (the first was chaotic enough.) It’s no surprise that economic uncertainty is being reflected in the market. Are we winning yet?
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