There have been no significant spikes or dips in the last 5 trading days. Some United States data that should support the Greenback to rebound from a 9-month low is not particularly important or overlooked by markets.

This is because investors tend to focus more on the announcement of the results of the Federal Reserve meeting to be held next week. The Dollar Index (DXY) was depressed 0.07 percent.

That was occurred in a week after fluctuating in a limited range. Year-to-Date or since January 1, 2023, DXY has decreased by 1.52 percent. 

Expectations that the Fed will reduce the pace of rate hikes still seem to continue to affect the USD's performance in last week's trading. That is why; market participants are still aware of that.

Short Term Bias is Negative 

Short-term bias is still negative. The movement of the Dollar Index on the Daily timeframe shows that the fluctuation of USD versus major currencies in the past week is still within the range (High/Low) formed on January 18.

This reflects high vigilance in anticipation of the Fed's monetary policy announcement. In other words, the US central bank's decision on interest rates is likely to be the focus of investors.

That is as well as an important catalyst that will influence the movement of the DXY in the next few days or weeks. If the rate hike is as expected by 25 basis points, then there is a sign. 

It is the Fed's press conference that will be the main concern of the market. Investors will listen to every detailed information and guidance related to the US economic situation.

WTI rose by $81 a Barrel

The situation above comes as well as the policy direction that will be conveyed before deciding to enter trading. Elsewhere, WTI oil prices rose above $81 a barrel.

That is happened amid growing optimism about oil demand from China. This relates to the Chinese government's decision to relax COVID-related policies. 

In addition, the number of deaths and severe cases from COVID is reportedly down 70% from the highest level earlier this year. On the supply side, OPEC is predicted to continue to maintain current production levels to keep oil supply tight.

Despite the above factors, market participants will also continue to monitor Russia's oil supply after the introduction of additional sanctions and price restrictions per next month.

The FOMC meeting result which was held at the end of last year revealed the Fed's plan to "rate hike". That could be 2 more times in 2023 And they will keep interest rates above the 5 percent rate. 

That decision will be used until the end of the year. However, people cast doubt on these projections due to the possibility of United States economic slowdown. 

Some analysts even gave their signal that the Fed should cut rates in the second half. However, some America’s economic data released some days before sided with the Fed's projections. 

The Department of Commerce in America reported that GDP grew by 2.9 percent so fat. It was for Quarter-over-Quarter as can be seen on the fourth quarter of 2022. 

Jobless Claim Data is Disappointing

That grow was lower than the 3.2 percent growth in the previous period. However, that AAA still better than the consensus estimate of just 2.6 percent. The Weekly jobless claims data also disappointing. 

The United States Department of Labor reported that the number of jobless claims decreased to 186k. It becomes a concern which must be noted by traders. 

But the biggest contributor to this growth story is inventory. That becomes a component that will almost certainly weaken throughout 2023. The analysts think that the current data supports expectations of a 25 basis point Fed rate hike.

The presence of these data is like a brake for a slump in the USD index for a while. The market's next attention will turn to several major central banks.