Press release
Uncertainty and downside risks grip the US dollar
London Loves Business
The USD recorded some volatility after the release of the Federal Reserve’s minutes on Thursday as well as data on the US job market with uncertainty increasing to a certain extent. Traders continue to monitor new economic data releases for clues about the next steps in monetary policy.
While expectations point to a possible end to the Federal Reserve’s interest rate hike cycle, the institution’s concerns with the level of inflation and the resilience of the economy fueled some uncertainty regarding the possibility of another hike this year.
The Federal Reserve’s minutes affected traders’ estimates as it became clearer that the Federal Reserve was still concerned about inflation. However, some division was noted among the Fed’s governors.
The US dollar could see some volatility against the Euro after the release of the Eurozone CPI data as traders remain concerned about the ECB’s response. The British pound could find some support as traders could see the Bank of England continuing its efforts to lower inflation.
The US currency could also see some weakness against the Chinese yuan if efforts to prop up the currency become more pronounced. Similar concerns could fuel some risks against the yen as the Bank of Japan could move to support its declining currency.
Sources: London Loves Business
London Loves Business
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