The dollar went up and the Sterling traded near its all-time highs against the US currency in the last fourteen months this Monday, on a day in which Wall Street remained without operations due to the holiday of emancipation day in the united states.
Also, from a global perspective, this occurs in a world in which the movements of the currency market have been dominated by the efforts of central banks to curb inflation and in which the dollar index Last week it registered its biggest weekly drop since January, after the Federal Reserve paused the dynamics of raising interest rates.
Operators will closely monitor the statements that the president of the United States Federal Reserve (Fed), Jerome Powell, will offer to Congress on Wednesday and Thursday, seeking clues about the future path of rates in the world’s largest economy.
The dynamics of the dollar in the world
In that context, the dollar indexwhich compares the greenback with a basket of six leading currencies, rose 0.2% this Monday to 102,480 points and was close to the minimum of 102 in a month, which it touched on Friday.
Investors are digesting last week’s central banks’ monetary policy decisions and awaiting a pronouncement on what the Bank of England will do going forward, due this Thursday.
The expectation is that the bank of england raise rates at least 25 basis points on Thursday, a level four times higher than its target, in the midst of fighting inflation.
What about the pound and the euro?
In that scenario, the British pound fell 0.2% to $1.2796 and traded near 14-month highs against the dollar, on expectations that the rate hike in the United Kingdom will exceed that of other major economies.
On the other hand, in a busy week for central banks, in which the European Central Bank raised rates by 25 points on Thursday and left the door open for more hikes, while the Bank of Japan’s decision on Friday to continue its ultra-loose policy keeps the yen fragile, the euro fell 0.2%, to au$s1.09190, close to hitting a 1-month high, while the yen was steady at $141.840, near a seven-month low of $142.005.
Source: Ambito
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