The Dollar Index (DXY) is a measure of the value of the US dollar against a basket of global currencies-the-barometer-for-global-currencies/1320). The basket of currencies currently consists of six currencies: the Euro, UK Pound, Canadian Dollar, Japanese Yen, Swedish Kroner, and Swiss Franc-the-barometer-for-global-currencies/1320). Each of these currencies is weighted in the proportion of the breadth and depth of their trading relationship with the US-the-barometer-for-global-currencies/1320). The DXY measures the strength of the US dollar versus this six-currency basket-the-barometer-for-global-currencies/1320).
The DXY is used as a barometer for global currencies and is considered the leading benchmark for the international value of the US dollar. It is also used by investors to hedge general currency moves or speculate. The DXY is available indirectly as part of exchange-traded funds (ETFs) or mutual funds. Traders can trade the DXY through the ICE U.S. Dollar Index (USDX) futures contract, which is considered the worlds most widely recognized traded currency index.
In summary, the DXY is a measure of the value of the US dollar against a basket of global currencies, and it is used as a barometer for global currencies and by investors to hedge currency moves or speculate. Traders can trade the DXY through the ICE U.S. Dollar Index (USDX) futures contract.
