Dollar rises as Fed signals rate hikes in 2023

17.06.2021 - Petr Mazaylo
Dollar rises as Fed signals rate hikes in 2023

The dollar climbed during early trade in Europe on Thursday. The rise was seen on higher levels unachieved for around two months following the Federal Reserve’s surprised markets with a hawkish turn, bringing forward its timetable for raising interest rates to 2023.

The Dollar Index, which tracks the greenback against a basket of six other currencies, gained 0.2% at 91.418, after surging nearly 1% overnight, its biggest climb since March of last year.

USD/JPY added 0.1% at 110.75, just off its recent high of 110.83, a level not seen since April 1; EUR/USD dropped 0.1% to 1.1986, after falling over 1% overnight, its biggest drop since April 2020; GBP/USD was flat at 1.3987, just above its lowest level since May 7; and the risk-sensitive AUD/USD gained 0.1% at 0.7617, recovering to a degree after earlier falling to 0.7598, the lowest since April 13.

The U.S. Federal Reserve ended its recent two-day policy meeting on Wednesday and handed down the expected policy stance of maintaining the current levels of interest rates and monthly bond purchases.

However, the Fed surprised investors when new projections saw 11 of 18 central bank policymakers plan for two interest rate increases of 25 basis points in 2023, a year earlier than expected, and a sharp change from the previous meeting when none of these officials were looking for hikes during that year.

Risk disclaimer "PROMETHEUS LTD – Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Republic of the Marshall Islands MH96960 is a financial services institution outside the European Union Area, which is subject to the supervision of the IFMRRC Certificate 0395 AA V0155 Trading in Forex/ CFDs and Other Derivatives is highly speculative and carries a high level of risk. It is possible to lose all your capital. 70% of trading deals can be unprofitable. These products may not be suitable for everyone and you should ensure that you understand the risks involved. Seek independent advice if necessary. Speculate only with funds that you can afford to lose. This Website may contain information in particular regarding financial services and products that could be regarded b a E.U. supervisory authority as an offer of financial services targeted in Europe. ESMA intervention measures do not apply to customers of PROMETHEUS LTD and it is your responsibility to choose a company which is most suitable for your trading needs. By clicking continue you confirm that you have read, understood and agree to the risk disclosures, terms of service, cash policies, privacy policies and this notice and that you are visiting this website on your own initiative, without any encouragement whatsoever from or PROMETHEUS LTD." Cookies notification: We use cookies to ensure that we give you the best experience on our website. If you continue to use this site we assume that you are happy with it. Read more. Continue

Help with deposit?