The dollar appreciated to its highest level since March 2017 against the yen, following stronger-than-expected retail sales data released in the United States last month on Tuesday.
At a time when inflation is skyrocketing, the figures fueled expectations of a rate hike in mid-2022. Investors also believe that the Fed could accelerate the downsizing of its asset purchase program.
“Ultimately, we are in a place where it appears that growth is still quite strong.”, dijo Mike Bell, de JP Morgan Asset Management. “The Fed is going to cut (its asset purchase program) before raising rates, and I think that is supporting the dollar.”
The dollar rose to 114.98 yen, but then traded flat at 114.77, and the euro fell to $ 1.1263 for the first time since July 2020.
The dollar index, which compares the green bill with a basket of six prominent coins, it rose to 96.26 units, its highest level since July. Its strength weighed on US Treasuries and the yield on benchmark 10-year notes hit a three-week high at 1.649% during Asian trading.
The bags were holding steady. The pan-European STOXX 600 Index was up 0.2%, on course to end its sixth consecutive day of gains and near record highs.
However, UK stocks were down 0.2%, pressured by the British pound, which hit a 21-month high against the euro after inflation soared to a 10-year high, reinforcing bets on rate hikes. of the Bank of England.
Against the dollar, the pound was up 0.3% at $ 1.3480, its highest level since Nov. 10. Analysts see the Bank of England likely to raise rates after it surprised investors by keeping its policy stable last month.
MSCI’s World Stock Index, which includes stocks from 50 countries, was down 0.1%, while Wall Street futures were flat.
MSCI’s broader measure of Asia-Pacific stocks excluding Japan fell 0.3% from a nearly three-week high at the close on Tuesday, en route to its biggest monthly slide and ending seven days of gains.
Crude prices were down 50 cents after data showing US gasoline inventories fell more than expected last week, increasing pressure on US authorities to release oil from their emergency reserves.
Source From: Ambito
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