Expectations of Fed rate cuts remained stable while the euro, the pound and, above all, bitcoin marked increases.
He global dollar fell this Thursday, on a day in which other currencies such as the euro and the pound but, above all, the bitcoin, They are protagonists of the markets.
He dollar index —which measures the performance of the greenback in relation to a basket of six other internationally relevant currencies— fell 0.6% to 105.74 units, after the president of the Federal Reserve (Fed), Jerome Powellsaid the U.S. economy is stronger now than the central bank had expected when it began cutting rates in September, appearing to signal support for a slower pace of cuts in the future.
However, the bets on rate cuts The Fed’s forecasts remained broadly stable, perhaps influenced by weaker-than-expected services sector data released on Wednesday. Markets are pricing in a around 74% chance of a 25 basis point rate cut later this month. Focus will be on the US nonfarm payrolls report for November due out on Friday, which is expected to show 200,000 jobs were created in the month, according to a Reuters poll, after only 200,000 jobs were created in October. 12,000 jobs, the lowest figure since December 2020.
Euro, pound and bitcoin
However, the attention of operators was focused on other currencies in the world. He euro rose 0.6% to $1.0567, moving away from a two-year low of $1.0332 hit in late November, as investors braced for a prolonged reckoning for France, after that country’s government collapsed following the approval of the no-confidence motion that now threatens its ability to control a massive budget deficit. The risk premium -or differential- that investors demand to maintain French debt against German debt has increased to reach its highest level since 2012.
The euro managed to rise despite the uncertainty because the government collapse was already priced in, he told Reuters. Lee Hardman senior currency analyst MUFG.
Traders are practically certain that the European Central Bank (ECB) will cut rates next week and estimate a easing of around 157 basis points by the end of 2025.
For its part, the pound It rose for the third day in a row and added 0.15% to its streak to reach $1.27. The British currency has been at the mercy of the dollar in recent months, falling from a year-and-a-half high in October as the American labor market was advancing strongly and falling further in November while the re-election of donald trump boosted the US currency.
But the star of the day is the bitcoin, on the rise since November due to expectations of the new cryptocurrency regulatory framework in the Trump government: it rose to an all-time high of $103,619, driven by the nomination of the pro-cryptocurrency Paul Atkins to direct the United States Securities and Exchange Commission. This marks an increase of around 5% on the day, which took its year-to-date gains to over 140%.
“There are reasons to believe this could continue,” he said. Kyle Rodda senior financial market analyst Capital.Com, highlighting the friendlier regulatory environment.
Source: Ambito
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