Trade-Weighted U.S. Dollar Index
A trade-weighted U.S. dollar index measures the U.S. dollar’s value against a basket of currencies weighted by the share of U.S. trade with each country. It provides a broad gauge of the dollar’s external value beyond any single currency pair.
Example: For example, a higher trade-weighted dollar index indicates the dollar is stronger on a broad, trade-weighted basis, which can affect U.S. export prices and import costs.
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