United States stocks opened the session higher following the December jobs report and added to gains after Federal Reserve Chairman Jerome Powell said the USA central bank had no "pre-set" plan for interest rates and was carefully monitoring economic conditions.
He also defended his independence, saying he would not resign if requested Donald Trump asked.
DXY's up move to the 96.60 region, or session highs, is now an ephemeral memory as a outcome of the dovish tone from Chief Powell's speech at the annual meeting of the American Economic Association.
Powell's appearance in Atlanta was his first since last month's rate increase and a public lashing from Trump, who according to sources asked aides about his power to fire the Fed chairman.
The Fed said in December it anticipated raising rates twice in 2019.
Asked if any future meeting with Trump was scheduled, Powell said, "I have no news on that". Powell also told the outlet that, even if he's asked, he will not resign.More news: Bournemouth sign Dominic Solanke from Liverpool for undisclosed fee
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Powell called the jobs report "very strong" and said he was also encouraged by the rise in the labor force participation rate and gains in wages, which he said "for me at this time does not raise concerns about too high inflation".
"Markets are expressing concerns about global growth in particular and trade negotiations", Powell said at an event in Atlanta.
"Particularly with the muted inflation readings that we've seen coming in, we will be patient as we watch to see how the economy evolves", he told the American Economic Association, adding that the Fed is not on a preset path of tightening policy and suggesting it could pause rate hikes as it did in 2016.
The Fed is "prepared to adjust policy quickly and flexibly" to support the economy, he added.
Both of those messages cheered stock market investors who had been anxious about Trump's repeated attacks on his hand-picked choice to lead the nation's central bank and also the Fed's seemingly inexorable march to higher rates.
"If we ever came to the conclusion that any aspect of our plans was somehow interfering with our attainment of our statutory goals, we wouldn't hesitate to change it, and that would include the balance sheet, " he said.