The Dollar slumped on Thursday, hitting its lowest level against the Euro in nearly three weeks, as investors reduced their expectations for a Federal Reserve interest rate rise this year.
While the Federal Reserve on Wednesday said inflation risks had increased, it did not use language that convinced markets a rate rise was likely at its next policy meeting in August. In contrast, the ECB has repeatedly said it may lift interest rates in July to fight inflation. That helped push the Euro near a three-week high at 1.5768. The US central bank’s move to leave interest rates unchanged on Wednesd (more…)
The Dollar fell to three-week lows against the Euro on Friday, dented after Oil prices surged to a record high, data showed US consumer sentiment hit a 28-year low and Wall Street stocks extended their slide.
The Dollar would stay under pressure after US financial shares fell on Friday on worries about more credit losses. Lehman Brothers forecast Merrill Lynch would write down another $5.4bio in the 2nd quarter, while Moody’s said it may cut Morgan Stanley’s credit rating.
The European Central Bank holds a policy meeting on Thursday and is widely expected to raise rates to 4.25% fight rising (more…)
The Dollar rose on Monday, as weak euro zone data took the steam out of last week’s Euro rally and investors braced for a Federal Reserve statement this week that will likely focus on rising US inflation pressures.
The Fed’s inflation mindset when it announces its monetary policy decision on Wednesday should ensure that US interest rates will remain unchanged after a string of cuts since mid-September, analysts said.
The Fed is expected to hold rates at 2% on Wednesday but the futures markets have priced in a pair of rate hikes by year end due to surging energy and food price inflation. Unlik (more…)
The Dollar retreated on Tuesday as a lower US consumer confidence, 16-year low in June, and declining home prices raised doubts about the Federal Reserve’s ability to hike interest rates to stem inflation.
The Fed began a two-day monetary policy meeting on Tuesday, with analysts expecting the US central bank to hold interest rates steady at 2%. But traders will pore over the Fed’s accompanying statement for clues about possible hikes later in the year.
US short-term interest rate futures trimmed the chances of a rate hike in August to 70% from 74%.
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