dollar indexIt fell on Wednesday (22nd), falling for the fifth consecutive trading day. The Federal Reserve (Fed) raised interest rates by 1 yard earlier as expected, and signaled that it will only raise interest rates once more this year.
ICE, which tracks the dollar against six major currencies, in late U.S. trade dollar index (DXY) fell 0.7 percent to 102.53, the lowest since Feb. 3.
The Fed raised its benchmark interest rate target range by 1 yard on Wednesday to 4.75%-5%, the highest level since October 2007. Along with the rate decision announcement, the Fed also releases its latest Summary of Economic Projections (SEP), which includes a dot plot of interest rates.
The latest dot plot shows that officials forecast interest rates will peak at 5.1% this year, the same as forecast in December last year, suggesting that only one more rate hike is likely before the end of this year, and the tightening cycle is expected to draw to a close.
Facing news of the sudden collapse of Silicon Valley Bank (SVB) and Signature Bank, the Fed deleted the word “ongoing increases” in its latest statement. The language has appeared in every policy statement since March 16, 2022, when the rate hike cycle kicked off.
“The Fed did choose the path of less resistance and, while raising rates, also offered a relatively dovish outlook on rates, basically gave the market what they wanted,” said Karl Schamotta, chief market strategist at Corpay.
Investors also paid close attention to Powell’s comments on the banking crisis. Powell said at the press conference that the U.S. banking system is sound and has strong capital and liquidity. He will closely monitor the status of the banking system and is ready to use all tools if necessary to ensure that everything is in order.
Wells Fargo (Wells Fargo) analysts pointed out in a report that as long as bank liquidity problems remain, the Fed’s dovish interest rate hike means that the dollar may fall in the next few days or within a few days.
US dollar againstJPY0.8% lower on Wednesday to 131.34 JPYgiving up the gains of the previous trading day.
EURIt surged more than 0.8% to US$1.0868, continuing to reach a new high in about seven weeks. After data showed UK inflation was much higher than expected in February,GBPIt rose nearly 0.4 percent to $1.2266. The Bank of England (BOE) will announce its interest rate decision on Thursday.
Australian dollarIt edged up 0.2 percent to $0.6682,new zealandIt rose nearly 0.4 percent to $0.6217.
Before the Fed announced its interest rate decision,bitcoinAt one point it was approaching $29,000, the highest since June last year, as some investors hoped that the recent wave of bank failures would end the Fed’s more than year-long policy of raising interest rates, stimulating thecryptocurrencydemand, but ultimately hope is dashed.
After the Fed announced a 1-yard rate hike,bitcoinIt fell below $27,000 in the intraday session, and the subsequent decline was slightly restrained, and it still fell 2.8% to $27,396 before the time of writing.
As of about 7:30 Taiwan time on Thursday (23rd) Price:
- dollar indexAt 102.54. -0.65%
- EURExchange rate against US dollar (EUR/USD) 1 EURAgainst $1.0858. +0.84%
- GBPExchange rate against USD (GBP/USD) 1 GBPAgainst $1.2268. +0.43%
- Australian dollarExchange rate against U.S. dollar (AUD/USD) 1 Australian dollarAgainst $0.6682. +0.21%
- US dollar againstCanadian Dollars (USD/CAD) exchange rate quoted 1 US dollar to 1.3725 Canadian Dollars。+0.11%
- US dollar againstJPY (USD/JPY) exchange rate quoted 1 US dollar to 131.38 JPY。-0.79%
