“The Fed’s rhetoric has been very strong from almost everyone: we have to raise rateswe have to raise rates, rates are going to go up,” said Joseph Trevisanisenior analyst at FXStreet.com in New York.
The dollar trimmed its gains on Wednesday, after the minutes showed that Fed officials were concerned about raising interest rates too far as part of their commitment to rein in inflation.
Nevertheless, On Thursday, investors reconsidered this interpretation and focused on the probability that the central bank will continue to raise rates aggressively to curb inflation.
The minutes also noted what will be an important dimension of the Fed debate in the coming months: when to slow down rate hikes.
“Except for the part about slowing down the pace of rate hikes, the rest of the minutes are very rosy,” Brown Brothers Harriman’s Win Thin said in a report.
The dollar index gained 0.7% to 107.39 units, after reaching 197.57, a peak since July 19. While, the euro gave up to u$sdollars, its lowest value since July 18.
The greenback rose to 135.90 against the yenthe weakest level for the Japanese currency since July 28, while Sterling fell to $1.1920, the lowest level since July 22.
Meanwhile, data released on Thursday showed the economy remains relatively strong. The Philadelphia Fed’s monthly manufacturing index rose to 6.2 this month from -12.3 in July, beating estimates in a Reuters survey of economists.
For its part, the number of Americans who filed new applications for unemployment benefits also fell moderately last week.
Source: Ambito
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