“The Federal Reserve states that it has a dual mandate for hiking interest rates, which is 2% inflation and full employment. The truth, however, is much more likely that it is watching how equities are performing. The last thing the Federal Reserve wants is to tank the markets. If equities are performing well and it is perceived by the Fed that the market can handle a quarter-point rate hike, then it will hike rates,” according to Investopedia.
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UUP, which tracks the price movement of the U.S. dollar against a basket of currencies, including the euro, Japanese yen, British pound, Canadian dollar, Swedish krona and Swiss franc, is higher by 1.1% since last week’s FOMC minutes indicated a June rate hike is a real possibility.
Financial Select Sector SPDR
