(Reuters) – Although slightly under pressure, the dollar remains near a 5-1/2 month high, crushing the yen to around 34-year lows, after the Federal Reserve reiterated that interest rates will likely remain high.
The leaders of the US central bank, including President Jerome Powell, yesterday refrained from providing indications on the date of a possible rate cut, instead stating that monetary policy must remain restrictive.
The latest macro data seems to indicate that the US economy is not on the path expected by the central bank, and this is leading investors to reduce bets on future rate cuts. The risk of widening conflict in the Middle East increases the dollar’s short-term appeal as a safe haven.
At around 10.15am, the dollar was down slightly against the euro at 1.0629, not far from the five-and-a-half month high of 1.0601 hit yesterday.
The dollar index stood at 106.23, just below the five-month high of 106.51 marked yesterday. On a year-over-year basis, the index is up 4.8%.
The yen trades around 154.6 against the dollar, not far from the lows of the last 34 years.
The dollar’s strength holds the entire currency market in check, with emerging Asian countries trying to stem the decline of their currencies, while the prospect of rate cuts in the region this year is rapidly fading. [EMRG/FRX]
10.16am
CHANGE RIC BID ASK CLOSURE
EURO/DOLLAR EUR= 1.0629 1.063 1.0617
DOLLAR/YEN JPY= 154.59 154.62 154.71
EURO/YEN EURJPY= 164.33 164.37 164.26
EURO/POUND EURGBP= 0.8528 0.8533 0.8543
SPOT GOLD XAU= 2,383.5 2,383.9 2,381.1
NAME INDEX RECORD VALUE VAR. % CLOSURE
DOLLAR INDEX .DXY 106.227 -0.03 106.257
(Translated by Chiara Scarciglia, editing by Alessia Pé)
Tags: Forex dollar month highs focus Fed Middle East
