The 0.11% drop was due to Fed officials’ rejection of market expectations of imminent rate cuts.
He dollar fell this Wednesday, retreating from the almost three-month highs reached the previous day against the euro, after a rebound in recent days on surprisingly strong economic data in USA and the rejection of the officials of the Federal Reserve (Fed) to market expectations of imminent interest rate cuts.
He dollar index, a measure of the US currency against six major peers, including the euro, fell 0.11% to 104.01 units, just below its 100-day moving average of 104.20 units.
Analysts point to technical factors to explain the dollar’s decline, following a two-day rally of up to 1.4% against the euro after strong employment data from USA, as well as more hawkish rhetoric from the chairman of the Federal Reserve, Jerome Powell They ruined bets on an early cut in interest rates.
Meanwhile, the dollar fell 0.18% to 1.0722 per euro, after falling 0.1% on Tuesday, when it hit its highest level since November 14 at $1.0722.
Expectations about inflation and rates in the United States
At a general level, the schedule of rate cuts in USA remained uncertain after the regional presidents of the Federal Reserve Loretta Mester and Neel Kashkari will celebrate progress in inflation but they will point out that there is still work to be done before the monetary politics.
The president of the Richmond Fed, Thomas Barkin, declared that there are still doubts about the sustainability of the decline in inflation towards the 2% objective of the Fed and stressed that it needs to be generalized.
In turn, the governor of the Federal Reserve Adriana Kugler He noted that the central bank has not closed the door on a rate cut, even next month, should data show that monetary policy easing is necessary.
Source: Ambito
