Just as the equity market has turned it around in the last several days, the dollar is rising from the ashes as well. Those who have witnessed the dollar’s previous attempts at a rally have reason to be skeptical, but there are a few factors moving in the greenback’s favor now that were not just a few months ago.
For one, the price of oil has pulled back significantly, as crude lately traded at $127.07. Whether the pullback in oil is helping the dollar, or vice-versa, is a bit of a chicken-and-egg semantic argument; some credited the dollar’s rally with crude’s decline, but the two are clearly feeding each other, as well as the buying interest in equities. Of late, the dollar bought 107.81 yen, up from 107.33 Tuesday, and the euro was at $1.5706, down from $1.5779 Tuesday.