In recent weeks, investors have been incorporating a series of announcements of monetary policy tightening by large central banks, as They bet the authorities are concerned enough about rising inflation to end the era of easy money that stemmed from the Covid-19 pandemic.
The Reserve Bank of Australia (RBA), in the first of several meetings of central banks this week, offered a more subdued tone on Tuesday than investors had anticipated, a factor weakening the Australian dollar.
The Fed will announce its monetary policy decision on Wednesday and the Bank of England (BoE) will issue its statement on Thursday.
“We are seeing a development of the inflation issue, which gets out of control and forces central banks to act,” said Edward Moya, Oanda’s senior market analyst.
The dollar index, which measures the greenback against a basket of even currencies, added 0.13% to 94,050 units.
The market has fully discounted the Fed’s expected gradual reduction of monetary stimulus announcement and will look for clues as to when the central bank expects to start the cycle of interest rate hikes in the United States, similar to the Bank meeting. Central European (ECB) last week.
Among other currencies, the pound sterling was down 0.27% at $ 1.3626, after having already incorporated the estimates of an interest rate hike from the Bank of England that would be announced on Thursday. And the euro traded with a down 0.21% on the day, at $ 1.15825.
Source From: Ambito
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