Powell claimed that central bank officials were still debating approaches to reducing the Fed’s balance sheet, and said they could sometimes take two, three or four meetings to make such decisions. “Powell’s overall message on Tuesday was less aggressive than some investors expected, especially in light of recent comments from other Fed officials.”analysts said.
“High inflation and a strong recovery will require the Federal Reserve to raise interest rates at least three times this year, starting in March, and will ensure a rapid reduction in the Fed’s asset holdings to get excess cash out of the financial system, “Atlanta Fed Chairman Raphael Bostic said Monday.
While the dollar index was well supported in recent weeks by the idea that the Fed will increase interest rates aggressively this year, it struggled to beat the 16-month high reached at the end of November.
On Tuesday, the risk-sensitive Australian dollar rose 0.6%, helped by data showing that retail sales beat forecasts for the second month in a row in November.
While, the British pound gained 0.36% to hit its highest level against the dollar in almost 10 weeks, aided by expectations that the Bank of England will raise interest rates further.
Source From: Ambito
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