He global dollar rose in the early hours of Thursday, on par with the yields of the United States Treasury bonds, while the operators’ eyes are on the Federal Reserve (Fed) and the forecast for interest rates as the end of the year and the next government of Donald Trump.
He dollar index —which measures the performance of the greenback in relation to a basket of six other currencies of international relevance—was trading at 108,260 units. As the end of the year approaches, trading volumes have begun to decline and investors’ main focus remains on the U.S. rate forecast. Fed.
Since the president of the Federal Reserve, Jerome Powellprimed markets for fewer rate cuts next year at the latest meeting monetary policy central bank of the year, traders are now pricing in just about 35 basis points of easing by 2025. That, in turn, has lifted U.S. Treasury yields and the dollar, and the greenback’s renewed strength has been a drag on raw materials and gold.
The benchmark 10-year yield rose 2.6 basis points to 4.613% and is up about 40 basis points so far this month. The two-year yield also strengthened to 4.3489%.
“Given the aggressive cut in December, we believe the Fed will not attend the meeting Federal Open Market Committee (FOMC) January and will wait for more data before definitively resuming, or potentially ending, this cycle of cuts,” Reuters said. Tom Porcelli, chief economist of the United States in PGIM Fixed Income. “Given the change in Fed “Towards a less expansionary policy, together with the continued focus on both sides of the dual mandate, we believe that the market will have a more intense emphasis on economic events in the new year,” he added.
Regarding currencies, the dollar It stood near a two-year high against a basket of currencies and was headed for a monthly gain of more than 2%.
Meanwhile, the Australian and New Zealand dollars were among the biggest losers against a dollar dominant green on Thursday, with the Australian currency falling 0.5% to $0.6238. The New Zealander, meanwhile, fell 0.58% to $0.5646.
He euro fell 0.18% to $1.0399, while the yen languished near a five-month low and was last at 157.35 per dollar.
Japan is preparing to slightly increase scheduled sales of Japanese government bonds (JGB) to 172.3 trillion yen ($1.1 trillion) next fiscal year, the first increase in four years, according to a draft of the plan seen by Reuters. Yields barely reacted to the news, but were still higher on the day, in line with their US peers.
Three days down in Uruguay
In Uruguay, Meanwhile, on a day filled with festivities, the market closed earlier and the dollar fell 0.29% compared to Monday and closed at 44,028 pesos in the interbank price of the Central Bank (BCU), continuing the week downwards and chaining its third decline in a row, being on the verge of falling to the range of 43 pesos.
The US currency accumulated a monthly appreciation of 2.02% in December and an annual appreciation of 12.83%, since its price is 5.01 pesos above that registered after the closing of the last exchange day of the year past.
Source: Ambito
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