Trade Weighted US dollar Index

The Trade Weighted US dollar Index, also known as the broad index, is a measure of the value of the US Dollar relative to other world currencies. It is similar to the US Dollar Index in that its numerical value is determined as a weighted average of the price of various currencies relative to the dollar, however it differs in which currencies are used and how their relative values are weighted.

HistoryThe trade weighted dollar index was introduced in 1998 for two primary reasons. The first being the introduction of the euro, which eliminated several of the currencies in the standard dollar index; the second being to keep pace with new developments in US trade.[1]

[edit] Included currenciesIn the standard US Dollar Index, a significant weight is given to the euro. In order to more accurately reflect the strength of the dollar relative to other world currencies, the Federal Reserve created the Trade Weighted US Dollar Index,[2] which includes a bigger collection of currencies than the US Dollar Index. The regions included are:

Europe (euro countries)
Canada
Japan
Mexico
China
United Kingdom
Taiwan
Korea
Singapore
Hong Kong
Malaysia
Brazil
Switzerland
Thailand
Philippines
Australia
Indonesia
India
Israel
Saudi Arabia
Russia
Sweden
Argentina
Venezuela
Chile
Colombia