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US Dollar Index (DXY) remains on the defensive near 104.00 in the early hours of Tuesday, following a volatile week-start that initially depicted a rise to 104.40 before ending with no change.

Indicator of the dollar's value versus six main currencies fell the previous day due to disappointing US data and rising Treasury bond yields. In doing so, the DXY is also burdened by the absence of Federal Reserve (Fed) discussions during the pre-FOMC embargo preceding next week's monetary policy meeting.

In terms of the data, the US ISM Services PMI fell to 50.3 in May compared to 51.5 anticipated and 51.9 previously, while the growth of Factory Orders deteriorated to 0.4% compared to 0.5% market forecasts and 0.9% previous measurements. It should be noted that the final May readings of the S&P Global Composite PMI and Services PMI also indicated a decline.

As a result of weaker US statistics, market wagers on a June rate increase by the Federal Reserve dropped from around 80% in the middle of the previous week to nearly 25%. Similarly, the absence of Fed discussions could have weighed on US Treasury bond yields and the US Dollar.

It should be noted, however, that International Monetary Fund (IMF) Managing Director Kristalina Georgieva suggested over the weekend that the Fed must do more to tame inflation, which in turn prompted Gold purchasers to question the Fed's intentions.

Concerns regarding the need for US large banks to hold more capital to combat the landing crisis contrasted with policymakers' ability to avoid the debt-ceiling expiration, causing market participants and DXY traders to be perplexed.

Moving forward, a light economic calendar and the Fed's blackout may continue to trouble momentum speculators. Consequently, the US Consumer Price Index for May, due on June 13, is the next significant US economic release prior to the June 13-14 Federal Open Market Committee (FOMC) monetary policy meeting.

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