The US dollar Index zigzagged its way through Tuesdays as investors remain wary on the back of downside risks to global growth and a lift in bond yields over the past week. The U.S dollar index which measures the Greenbacks strength against a trade-weighted basket of currencies rallied from 95.68 up to a high of 96.16 but then fell touching a low of 95.64 on easing bond yields.
Meanwhile, on the data front, The NFIB small business optimism index edged down from 108.8 in August to 107.9 in September. However, the index remains near an all-time high with small business owners remaining mostly positive about the economy and their business environment. Among the sub-indices, drops were evident in hiring and compensation plans. The proportion of small business owners reporting that their compensation costs had increased rose five percentage points in September to a record high 37%, while the share planning to raise compensation costs in the future increased three percentage points to 24%. Both are highs for this cycle but are only marginally above the range recorded over the past year
IMF Financial Counselor and Director Tobias Adrian sent out the message yesterday that "Near-term risks to global financial stability have increased somewhat, and market participants appear complacent about the risk of a sharp tightening in financial conditions." The warning comes with an overall global growth downgrade, as pressures in emerging markets escalate, trade tensions and financial risks with deteriorating global trade relations cited as the cause.