U.S. Dollar Trades Higher As Fed Signals Early Rate Hikes
17 June 2021 - 1:26PM
RTTF2
The U.S. dollar traded higher against its major counterparts in
the Asian session on Thursday, after the U.S. Federal Reserve
pushed forward its projections for the interest rate hikes and
indicated that policymakers had started discussions about scaling
back the bond purchase program amid receding risks from
coronavirus.
The Fed's projections showed two quarter-point interest rate
hikes for 2023, versus none in the March forecasts.
Seven officials penciled in a first hike as early as 2022.
The central bank raised its projections for inflation and
economic growth and took initial steps to wind down the bond
purchase program.
In his post-meeting press conference, Fed Chair Jerome Powell
said reaching the standard of "substantial further progress" is
still "a ways off" and stressed the central bank would provide
"advance notice" before making any changes to its asset
purchases.
U.S. treasury yields rose, with the benchmark 10-year yield
touching 1.5890 percent.
The greenback climbed to its highest since April 1 against the
yen, at 110.82. Against the pound, the greenback rose to a
1-1/2-month high of 1.3971. The greenback had ended Wednesday's
deals at 110.71 against the yen and 1.3981 against the pound.
The greenback moved up to a 1-1/2-month high of 0.9107 against
the franc and near a 2-month high of 1.1973 against the euro,
compared to yesterday's closing values of 0.9086 and 1.1995,
respectively. If the greenback rises further, 0.92 and 1.18 are
likely seen as its next resistance levels against the franc and the
euro, respectively.
In contrast, the greenback pulled back to 1.2262 against the
loonie and 0.7645 against the aussie, from its early 1-1/2-month
high of 1.2292 and more than a 2-month high of 0.7597,
respectively. The greenback is likely to challenge support around
1.20 against the loonie and 0.78 against the aussie.
The greenback reversed from its early high of 0.7047 against the
kiwi and was worth 0.7102. The next likely support for the
greenback is seen around the 0.73 level.
Looking ahead, the Swiss National Bank's monetary policy
announcement will be out at 3:30 am ET. Economists widely expect
the central bank to maintain policy rate at -0.75 percent.
Eurozone final CPI for May and construction output for April are
set for release in the European session.
U.S. weekly jobless claims for the week ended June 12 and
leading index for May will be published in the New York
session.
US Dollar vs CAD (FX:USDCAD)
Forex Chart
From Apr 2024 to May 2024
US Dollar vs CAD (FX:USDCAD)
Forex Chart
From May 2023 to May 2024