After dovish comments from Federal Reserve officials,dollar indexIt fell to a three-month low on Tuesday (28th). Investors believe that U.S. economic growth has begun to slow since entering an aggressive tightening cycle last March, which should prompt the Federal Reserve to ease monetary policy at some point next year.
According to CME’s FedWatch tool, U.S. interest rate futures indicate a 23% chance of a rate cut in March next year, while the chance of a May rate cut has risen to about 50%.
In late New York trading, ICE tracks the dollar against six major currencies. dollar index (DXY) fell 0.42% to 102.77, the lowest since August 31. The decline in November is expected to exceed 3%, marking the worst monthly performance since November 2022.
Karl Schamotta, chief market strategist at Corpay, said: “For decades, when the U.S. economy has been extremely weak or strong relative to the rest of the world, the U.S. dollar has tended to perform better. In situations similar to the current one, when most major economies “When the economy is just barely getting over the hump and the growth gap between the U.S. and other regions narrows, the dollar usually falls.”
“Dollar outflows will continue to grow through the end of the year as investors rebalance their portfolios and take advantage of cooling growth expectations for 2024,” he said.
Dovish comments from Fed officials also weighed on the dollar. Fed Governor Christopher Waller said he is increasingly confident that current interest rates are restrictive enough, and even hinted that if inflation continues to decline and approaches the Fed’s 2% target, interest rates may be cut in the coming months.
Chicago Fed President Austan Goolsbee praised the progress in cooling inflation, saying such a pace had not been seen since the 1950s.
Fed Governor Michelle Bowman agreed that the central bank has made progress in guiding inflation down, but also said that she will pay close attention to the next economic data. If the anti-inflation progress stalls, it may not be enough to bring the inflation rate down in time. Back to 2%, she is willing to support a rate increase at future meetings.
Data on Tuesday showed that U.S. consumer confidence rebounded in November, rising to 102 from 99.1 after three consecutive months of declines, but households still expected a recession next year. On the other hand, the US FHFA house price index accelerated again in September, with an annual increase of 6.1%.
EURIt rose above US$1.1 against the US dollar for the first time in more than three months, rising 0.32% to US$1.0989 at the time of writing.GBPIt also rose nearly 0.6% to $1.2696, both rising for four consecutive sessions.
Traders are watching core U.S. personal consumption expenditures (PCE) price index data due later this week for further confirmation that inflation is slowing.In addition to PCE, includingEURThe inflation rate of the region’s major economies, China’s Purchasing Managers Index (PMI) and the production meeting of the Organization of the Petroleum Exporting Countries and its oil-producing allies (OPEC+) are also market focuses this week.
As the dollar falls,JPYrebounded 0.8% to 147.47 JPYagainst 1 US dollar.Swiss francThe Swiss franc rose 0.2% to 0.8781 Swiss franc per dollar, the highest since early September.Australian dollarHitting a nearly four-month high, it rose 0.6% to $0.6648 at press time.
New Zealand dollarIt rose nearly 0.7% to $0.6136, the highest since early August. The Bank of New Zealand will hold a monetary policy meeting on Wednesday, and the market expects the central bank to keep interest rates unchanged at 5.50% for the fourth consecutive time.
As of approximately 6:00 Taiwan time on Wednesday (29th), price:
- dollar indexReport 102.7385. -0.4635%
- EURExchange rate quote against the US dollar (EUR/USD) 1 EURAgainst US$1.0993. +0.3652%
- GBPExchange rate quote against the US dollar (GBP/USD) 1 GBPagainst US$1.2698. +0.5623%
- Australian dollarExchange rate quote against the US dollar (AUD/USD) 1 Australian dollaragainst USD 0.6648. +0.6358%
- USD vs.Canadian Dollars (USD/CAD) exchange rate is quoted at 1.3571 per US dollar Canadian Dollars。-0.3232%
- USD vs.JPY (USD/JPY) exchange rate was quoted at 147.45 per U.S. dollar JPY。-0.8273%
2023-11-28 22:18:43
#York #Forex #Market #Fed #officials #expressed #dovetails #U.S #dollar #index #fell #threemonth #euro #rose #U.S #dollars #Anue #JuhengForex
