It is worth remembering that the US currency has gained almost 3% so far this month and is headed for its biggest monthly rise in nine months.
At the same time, the euro began trading at a low of more than a month, to later rise to US$1.0879, while the Japanese yen fell below 126 per dollar for the first time in 20 years.
The prospect of a rapid and aggressive rise in US interest rates and growing market expectations that the Bank of Japan will maintain its ultra-low short-term rates have fueled the Japanese currency’s declines against the dollar.
Bank of Japan Governor Haruhiko Kuroda warned on Wednesday that the recent rise in inflation, fueled by rising import costs, could hurt the economy, underscoring the central bank’s determination to maintain ultra-easy monetary policy. .
Although underlying US inflation pressures showed some signs of moderating in Tuesday’s data, traders increased bets that the US central bank will speed up its monetary tightening measures this year.
It should be noted, however, that there are analysts who project that the dollar will weaken in the coming months because the market has already discounted the rate hike and the lower monetary expansion of the Fed. “Buy on the rumour, sell on the news.” “, is the motto that investors seem to follow in this type of case.
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Source: Ambito
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