USDX is similar to Dow Jones Industrial Average, which shows the comprehensive situation of American stocks. The dollar index shows the comprehensive value of the dollar. An indicator to measure the strength of various currencies. Surprisingly, the US dollar index is not from CBOT or CME, but from new york Cotton Exchange (NYCE). New york Cotton Exchange was founded in 1870, which was originally composed of a group of cotton merchants and middlemen. At present, it is the oldest commodity exchange in new york and the most important cotton futures and options exchange in the world. 1985, new york cotton exchange established the finance department, and officially entered the global financial commodity market. The first is the US dollar index futures. The foreign currency and weight used by USDX are the same as the weighting index of US dollar transactions in the Federal Reserve System. Since USDX is only based on foreign exchange quotation indicators, it may be different due to the use of different data sources. USDX is calculated with reference to the geometric average weighted value 1973 of the exchange rate changes of several major currencies against the US dollar in March, and its value is calculated based on 100.00. For example, the quotation of 105.50 points means that its value has increased by 5.50% since March 1973. March 1973 was chosen as the reference point because it was a historic turning point in the foreign exchange market. Since then, major trading countries have allowed their currencies to float freely with the currencies of another country. The agreement was reached at the Smithsonian Institution in Washington, D.C., symbolizing the victory of free trade theorists. The Smithsonian Agreement replaced the unsuccessful fixed exchange rate system reached in Bretton Woods, New Hampshire, USA in 1944.

The influence of the dollar on the gold market

The impact of the dollar on the gold market is mainly in two aspects. One is that the US dollar is the quoted currency in the international gold market, so it is negatively related to the price of gold. Assuming that the value of the gold price itself has not changed, the price of the gold price will rise if the dollar falls. On the other hand, gold is an alternative investment tool for dollar assets. In fact, in the years before 2005, one of the main factors for the continuous rise of gold prices was the sharp decline of the US dollar for three consecutive years.

According to the statistics of the historical data in the past 30 years, the negative correlation between the US dollar and gold is about 80%. From the data of the past ten years, as shown in the following figure, from the correlation chart of the US dollar and gold from 1995 to 2003, it can be seen that the relationship between the US dollar and gold is approaching-1%. Therefore, when we analyze the trend of gold price, the change of US dollar exchange rate is an important reference.

Dollar index

Usually, the tool we use to analyze the trend of the US dollar is the US dollar index, which is an index that comprehensively reflects the exchange rate of the US dollar in the international foreign exchange market and is used to measure the degree of exchange rate change of the US dollar against a basket of currencies. It measures the strength of the US dollar by calculating the comprehensive rate of change between the US dollar and a selected basket of currencies, thus indirectly reflecting the changes in US export competitiveness and import costs. If the dollar index falls, it means that the dollar depreciates against other major currencies. The calculation principle of dollar index futures is based on the trade settlement between major countries in the world and the United States, with 100 as the dividing line, and the overall strength of the dollar is calculated in a weighted way. After the launch of 1999 65438+ 10/Euro, the subject matter of the futures contract was adjusted from ten countries to six countries, and the euro became the most important and weighted currency, accounting for 57.6%. Therefore, the fluctuation of the euro has the greatest influence on the strength of the US dollar index.

Dollar index weight:

Euro 57.6 yen 13.6 pounds 1 1.9 Canadian dollars 9. 1 Swedish krona 4.2 Swiss francs 3.6

The USD index USDX is calculated with reference to the geometric average weighted value 1973 of the exchange rate changes of six currencies against the USD in March. Its value is measured by 100.00. The quotation of 105.50 means that its value has increased by 5.50% since March 1973.

March 1973 is chosen as the reference point because it is a historic moment of the turning point in the foreign exchange market. Since then, major trading countries have allowed their currencies to float freely with the currencies of another country. The agreement was reached at the Smithsonian Institution in Washington, D.C., symbolizing the victory of free trade theorists. The Smithsonian Agreement replaced the unsuccessful fixed exchange rate system reached in Bretton Woods, New Hampshire about 25 years ago.

The current USDX level reflects the average value of the US dollar relative to the benchmark 1973. The US dollar index soared to 165 and also fell below 80 points. This change feature is widely compared with the futures stock index in quantity and change rate.