The global dollar rises after tariff threats and feat cuts in Europe

The global dollar rises after tariff threats and feat cuts in Europe

The American currency operated up to novelties at the local level and those that arrived from the old continent.

Photo: Pixabay

He global dollar went up Thursday in front of some of his peers, including the yen and the euro, since the markets weigh new tariff threats, a slower economic growth than expected in USA and a cut of interest rates on the part of the European Central Bank (ECB).

He dollar index —What measures the performance of the green ticket in relation to a basket of six other foreign exchange currencies – rose 0.2% to 108.12 units, after the Fed will make the decision to maintain interest rates without changes in the range of 4.25 to 4.5% at the first meeting of the Federal Open Market Committee (FOMC) of the year – and the first with Donald Trump In the Presidency – as the markets expected.

Likewise, the president of the US Central Bank, Jerome Powell, He said there would be no hurry to cut them again. Trump’s policies are still a risk to the policy perspectives of the Fed, And it is likely that on Saturday new tariffs will be imposed on Canada, Mexico And possibly China.

“Powell was not willing to talk about the possible economic impact and the response of monetary policy to tariff To Reuters Elliot Clark, Director of International Economy of Westpac. “However, Powell made it clear at the press conference that, although the economy is strong, it is not overheated,” he added, even despite the republican’s request to lower rates quickly, as he said during his speech in the World Economic Forum in Davos, Swiss.

Tariffs and economic data

President Trump said Thursday that he will impose a 25% tariff to imports from Mexico and Canada, repeating their warning to the two countries that are the main commercial partners of the United States.

“When Trump says that something is imminent, the market is reluctant to believe it or accept it fully until the orders are signed, and the market was definitely taken by surprise there,” he said Adam Button, Forexlive currency chief analyst in Toronto.

The data of the Commerce Department Published on Thursday they showed that the US economy grew by 2.3% annualized in the fourth quarter, slightly below the expectations of analysts, in the midst of a weak business expense. Inflation rose slightly, and the Personal Consumption Expenditure Price Index (PCE) increased 2.5%.

Cut to rates in Europe

He BCE He reduced indebtedness costs at 25 basic points, as expected widely, and left the door open to more cuts as concerns about a mediocre economy replace concerns about persistent inflation.

The dollar weakened 0.54% to 154.36 against Japanese Yen. In front of the Swiss Franco, 0.33% to 0.91 was strengthened. He euro reversed the previous profits and dropped 0.24% to $ 1.0395.

“We saw that increase in the euro, but I was surprised by the comment of (the president of the ECB) Christine Lagarde, Where he explicitly said ‘we have not had an argument about whether it is time to stop cutting interest rates,’ “said Button.

Source: Ambito

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