News

Dollar Rally Sputters, Fed Sends Mixed Signals on Inflation

0

The U.S. dollar vacillated below an 11week high versus major peers on Thursday as traders attempted to navigate conflicting signals from Federal Reserve officials on the timing of a withdrawal of monetary stimulus.

The dollar index, which measures the greenback against six rivals, stood at 91.847 in Asia after rebounding from as low as 91.509 on Wednesday. It was as high as 92.408 at the end of last week, the strongest since April 9.

The U.S. currency got some support overnight as two Fed officials said that a period of high inflation in the United States could last longer than anticipated, a day after Fed Chair Jerome Powell had played down rising price pressures.

Atlanta Fed President Raphael Bostic and Fed Governor Michelle Bowman said that while they largely agree recent price increases will prove temporary, they also feel it may take longer than anticipated for them to fade.

The dollar index jumped as much as 2.1 last week after the Fed surprised markets on June 16 by saying that policymakers are forecasting two interest rate hikes in 2023.

But the index gave up about a third of those gains after Powell on Tuesday said that inflation is climbing due to a perfect storm as the economy reopens from the COVID19 pandemic, and that those price pressures should ease on their own.

Six Fed officials are due to speak on Thursday, including New York Fed President John Williams, who on Tuesday said any conversation about when to adjust interest rates is still far off.

The…

SP 500 Inches Closer to Record, Nasdaq Hits AllTime High

Previous article

Nikkei Flat; Mercari Jumps on First Annual Profit Outlook

Next article

You may also like

Comments

Leave a reply

Your email address will not be published. Required fields are marked *

More in News