The US Central Bank will publish the minutes of its last meeting this Wednesday and agents wait for future rate cuts.
He global dollar rose in front of euro on Tuesday, contrary to what happened in Uruguay, since those responsible for the monetary policy of the United States Federal Reserve They stated that it is prudent for the US central bank to wait several more months to ensure that the inflation really get back on track with the 2% target before starting to cut interest rates.
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Against other currencies, the greenback remained practically stable, awaiting the American holiday of Memorial Day next week, with an eye on a gesture of the Fed about rates. The euro fell 0.05% to $1.0852, while the US currency lost 0.04% against the Japanese yen to 156.20.
The pair dollar-yen has moved in narrow ranges in the last two trading days, after a tumultuous start to May following alleged rounds of monetary interventions by Tokyo to prop up the yen. Fear of intervention by the Japanese authorities has deterred traders from pushing the yen to new lows. The yen fell to more than 160 to the dollar on April 29, its lowest level in 34 years.
“Amid the dearth of catalytic economic data this week, trading ranges have tightened in the currency markets. However, the dollar remains in a strong position, reinforced by messaging from Federal Reserve officials,” he said Karl Schamotta, chief market strategist at Corpay in Toronto.
The governor of the Federal Reserve, Christopher Waller declared Tuesday at the Peterson Institute for International Economics in Washington that he would need to see several more months of good inflation data before he would feel comfortable supporting an easing of monetary policy.
“Reassuring” inflation data
Waller, however, put the brakes on any speculation that interest rates will have to rise again for demand to soften enough to further ease price pressures, saying the latest inflation data is “reassuring.” ” and that the probability of a rate hike is “very low.”
“The Fed speakers are driving the market, and so far they haven’t said anything that traders wouldn’t expect,” he said. Helen Given, currency trader, at Monex USA in Washington. “Barring a surprise in the FOMC (Federal Open Market Committee) minutes tomorrow afternoon, it’s likely that this could continue to be a fairly quiet week.”
