Connect with us
Finance Digest is a leading online platform for finance and business news, providing insights on banking, finance, technology, investing,trading, insurance, fintech, and more. The platform covers a diverse range of topics, including banking, insurance, investment, wealth management, fintech, and regulatory issues. The website publishes news, press releases, opinion and advertorials on various financial organizations, products and services which are commissioned from various Companies, Organizations, PR agencies, Bloggers etc. These commissioned articles are commercial in nature. This is not to be considered as financial advice and should be considered only for information purposes. It does not reflect the views or opinion of our website and is not to be considered an endorsement or a recommendation. We cannot guarantee the accuracy or applicability of any information provided with respect to your individual or personal circumstances. Please seek Professional advice from a qualified professional before making any financial decisions. We link to various third-party websites, affiliate sales networks, and to our advertising partners websites. When you view or click on certain links available on our articles, our partners may compensate us for displaying the content to you or make a purchase or fill a form. This will not incur any additional charges to you. To make things simpler for you to identity or distinguish advertised or sponsored articles or links, you may consider all articles or links hosted on our site as a commercial article placement. We will not be responsible for any loss you may suffer as a result of any omission or inaccuracy on the website.

TRADING

By Gertrude Chavez-Dreyfuss and Tommy Wilkes

NEW YORK/LONDON (Reuters) – The dollar slipped from a near two-year high on Thursday, as investors digested hawkish signals from the Federal Reserve and wondered whether expected tightening moves in the future have already been priced in.

The dollar index hit 99.823 on Thursday, the highest since late May 2020. It was last flat at 99.639.

St. Louis Fed president James Bullard, a voter this year on the Federal Open Market Committee and a known hawk, continued to sound the alarm on inflation on Thursday.

He said the Fed remains behind in its fight against inflation despite increases in mortgage rates and government bond yields that have raced ahead of actual changes in the central bank’s target federal funds rate.

Bullard’s comments, however, had little impact on the dollar.

The Fed has laid out its plans quite clearly so markets can plan knowing what’s ahead,” said Juan Perez, director of trading, at Monex USA in Washington.

He noted that in the Fed’s past four tightening cycles, the dollar has depreciated by an average of 4.0%. The dollar currently sits at a nine-month gain of 7%.

Perhaps history is ready to repeat itself. With global inflation also rising, other central banks will also be speculated to tighten their belts and thus improve the value of those currencies against the buck,” Perez added.

The dollar climbed to its highest in nearly two years on Wednesday after minutes from the March Fed meeting showed “many” participants were prepared to raise interest rates in 50-basis-point increments in coming months.

The Fed also prepared markets for a reduction in the Fed’s balance sheet after the May meeting at a rate of $95 billion per month, the beginning of the reversal of the massive stimulus it pumped into the economy after the COVID-19 pandemic struck.

That’s nearly twice as quick as was seen during the last balance sheet run-down during the 2017-19 cycle,” ING analysts said.

“All of the above points to the Fed applying a heavy foot to the brakes, which should be positive for the dollar.”

The euro, on the other hand, hit a one-month trough against the dollar of $1.0865, but was slightly higher on the day, just above $1.09.

European Central Bank policymakers appeared keen to unwind stimulus at their March 10 meeting, with some pushing for even more action, as conditions for raising rates had either been met or were about to be met, minutes of the ECB meeting showed on Thursday.

An increasingly close-looking presidential election in France is another wild card, and the prospect of far-right candidate Marine Le Pen beating incumbent Emmanuel Macron has undermined the euro and French debt ahead of Sunday’s first-round vote.

The Australian and New Zealand dollars fell 0.4% and 0.5% respectively versus the greenback, as the Fed’s tone offset a hawkish shift from Australia’s central bank, while a pullback in commodity prices also reversed some of their recent strength.

Against the yen, the dollar rose 0.2% to 123.965.

========================================================

Currency bid prices at 10:34AM (1434 GMT)

Description RIC Last U.S. Close Pct Change YTD Pct High Bid Low Bid

Previous Change

Session

Dollar index 99.4970 99.6370 -0.13% 4.008% +99.8230 +99.3900

Euro/Dollar $1.0922 $1.0895 +0.26% -3.92% +$1.0936 +$1.0865

Dollar/Yen 123.9200 123.7850 +0.11% +7.65% +123.9950 +123.4650

Euro/Yen 135.33 134.85 +0.36% +3.84% +135.5000 +134.4300

Dollar/Swiss 0.9321 0.9327 -0.06% +2.19% +0.9348 +0.9319

Sterling/Dollar $1.3077 $1.3069 +0.07% -3.30% +$1.3106 +$1.3054

Dollar/Canadian 1.2576 1.2544 +0.26% -0.53% +1.2595 +1.2538

Aussie/Dollar $0.7485 $0.7509 -0.31% +2.99% +$0.7570 +$0.7474

Euro/Swiss 1.0179 1.0169 +0.10% -1.83% +1.0198 +1.0147

Euro/Sterling 0.8351 0.8340 +0.13% -0.58% +0.8364 +0.8315

NZ $0.6896 $0.6916 -0.46% +0.58% +$0.6920 +$0.6884

Dollar/Dollar

Dollar/Norway 8.7765 8.8080 -0.03% -0.05% +8.8210 +8.7545

Euro/Norway 9.5896 9.5835 +0.06% -4.23% +9.6134 +9.5521

Dollar/Sweden 9.4443 9.4820 -0.17% +4.73% +9.4982 +9.4243

Euro/Sweden 10.3154 10.3331 -0.17% +0.80% +10.3580 +10.2952

 

(Reporting by Gertrude Chavez-Dreyfuss in New York and Tommy Reggiori Wilkes in London; Editing by Kim Coghill, Andrew Heavens and Nick Macfie)

Continue Reading

Why pay for news and opinions when you can get them for free?

       Subscribe for free now!


By submitting this form, you are consenting to receive marketing emails from: . You can revoke your consent to receive emails at any time by using the SafeUnsubscribe® link, found at the bottom of every email. Emails are serviced by Constant Contact

Recent Posts