The US Dollar continues to rise today, hitting a new seven-week high. A series of upbeat economic data has further reduced bets on an early easing of monetary policy by the US central bank (Fed). Optimism is also growing that a debt ceiling deal will be negotiated to avert the threat of a US default.
Rising against other currencies
Around 17:45 CET, the dollar index, which tracks the dollar’s performance against a basket of six leading global currencies, rose 0.6 percent to 103.52 points. The euro weakened 0.6 percent against the dollar to $1.0778. The dollar gained 0.7 percent against the yen to JPY138.55. The euro gained 0.1 percent against the yen to trade at JPY149.29.
Today’s report showed that the number of new unemployment claimants was lower than expected. The regional business activity index then showed a smaller decline than markets expected.
Interest rate hike
Traders are now giving a 20 percent chance that the Fed will raise the key interest rate at its June meeting. About a month ago, they were giving a 20 percent chance of a rate cut.
The focus remains on the US debt ceiling negotiations. President Joe Biden will continue talks on the debt ceiling with congressional leaders later this week, according to a White House statement. Speaker of the House of Representatives Kevin McCarthy has vowed that the country will avoid default, Reuters reported.
Source Czech Press Office