Economists and market pundits have been getting cozy with the prospect of an interest-rate hike in September. U.S. economic data doesn’t appear to be offering any signs that such a move should be forestalled.The ICE U.S. Dollar Index DXY, +0.14% is up 6.54% year to date but is down 1.2% since the beginning of the week, and it is down 1.4% since the beginning of the month. An impending hike would, other things being equal, drag the dollar higher in anticipation of higher rates on dollar deposits.
Similarly, one of the greenback’s main rivals, the euro USDEUR, +0.2053% which had traded at $1.09 earlier in the month had climbed to $1.1167 late Wednesday in New York.
The dollar also is one of the drivers for dollar-denominated gold. Gold for December delivery G
CZ5, -0.20% has been enjoying a five-session rally, picking up nearly $30 during the stretch to settle at $1,123.60 an ounce Wednesday. Gold has gained 2.6% in August. That is hardly a move to be expected ahead of a rate hike. Although some of the move can be attributed to dollar weakness and global growth worries fueled by China, which is a boon for gold. Even still, that sort of environment doesn’t beg a rate hike.
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