U.S. dollar climbs to 18-month high as bitcoin holds firm around $86,000
The U.S. Dollar Index has reached an 18-month high, driven by Federal Reserve interest rate hikes and economic instability in Europe. Despite the resulting pressure on risk assets, Bitcoin has maintained a stable price around $86,000.
Why it matters
A strengthening dollar typically creates headwinds for crypto and stocks by increasing debt servicing costs and making government bonds more attractive to investors.
The U.S. Dollar Index (DXY), which measures the dollar against a basket of six major currencies, reached roughly 102.5 on Monday, its highest level in nearly 18 months. Having climbed from around 99 in early September, it is now comfortably above its 200-day moving average, also near 99, a signal of strengthening bullish momentum.
A stronger dollar typically creates headwinds for risk assets by increasing the cost of servicing dollar-denominated debt outside the U.S. and reducing overseas investors’ purchasing power. When accompanied by higher U.S. interest rates, it also makes cash and government bonds more attractive, raising the hurdle for investing in stocks and bitcoin BTC $86 065,58 .
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