The US Dollar Index fell towards the bottom of its recent trading range at the start of this week between 110.00 and 115.00. Today, the US midterm elections will garner market attention but the immediate impact is set to be muted, economists at MUFG Bank report. Instead, US Consumer Price Index (CPI) report on Thursday is likely to impact the USD.

US mid-term elections and US CPI report in focus this week

“Market participants’ focus will shift over the coming days to the outcome from the US mid-term elections although we do not expect the results to have an immediate impact on US Dollar performance.”

“The more immediate concern for setting Fed policy and driving US Dollar performance will be the release of the latest US CPI report on Thursday. The USD’s inability to regain upward momentum following the Fed’s recent hawkish policy update suggests it will be more sensitive to a softer inflation print this month that could trigger a break below the bottom of the recent range between 110.00-115.00.”