Forex glossary
DXY (U.S. Dollar Index)
ICE's geometric dollar index against a basket of six currencies with specified weights. It is not simply the inverse of EUR/USD or a measure against every currency; the futures price is a separate series.
Illustrative example
How does it work in practice?
In a hypothetical DXY series, the index rises from 100 to 101 points, a gain of 1 point or 1%. This does not mean USD rose by 1% against every currency: the index combines a specified basket and weights.
A case to work through
Index and pair
In a fictional file, DXY rises from 100 to 102 while USD/JPY is unchanged.
- The index change is 2%.
- Calculate USD/JPY from its own readings: here, 0%.
What follows? Keep the index and pair results separate.
Example boundary: The basket includes neither every currency nor every investor's objective.
A useful distinction
DXY (U.S. Dollar Index) / Commitments of Traders (COT) report
COT measures contract positioning; DXY aggregates exchange rates.
Check your understanding
Separate a basket result from a particular pair's movement.
Show the answer and explanation
By no automatically determined amount
The pair's own quotes are needed.
Publication, units and interpretation
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Sources and documentation
- U.S. Dollar Index futures – ICE
Describes the geometric six-currency index and its relationship to futures contracts.
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The example illustrates the mechanism. Check current account conditions and instrument specifications with the provider.