Around 9 p.m., the euro took 0.69% to 1.1446 dollars for one euro, a record since mid-November.
The euro rose above the threshold of $ 1.14 on Wednesday for the first time since November when the high US inflation, published Wednesday, is already taken into account by the markets and did not surprise investors.
Around 8:00 p.m. GMT, the euro took 0.69% to 1.1446 dollars for one euro, a record since mid-November.
Consumer prices in the United States climbed 7% in 2021, registering their largest increase since June 1982, according to the CPI index released Wednesday by the Department of Labor.
A priori, for traders, high inflation means that the US Federal Reserve (Fed) will tighten its monetary policy, which should strengthen the dollar.
But “the Fed should start to raise its rates in March” according to market forecasts “and the data of the day have not altered this scenario” already anticipated by the markets, said Fiona Cincotta, analyst at City Index.
“What confuses the dollar is that inflation is doing exactly what was expected,” summed up Joe Manimbo of Western Union.
“Of course, on the one hand we have US inflation at 7%, the highest for decades, but on the other hand, this factor is already widely taken into account because the greenback has been on the rise for some time now, in anticipation of ‘a toughening of Fed policy,’ the analyst added.
The day before, Fed Chairman Jerome Powell told the US Senate that the Monetary Institute would act “accordingly” if inflation persisted in the second half of the year.
Conversely, the European Central Bank (ECB) has so far signaled that it will not hike its rates in 2022, tolerating inflation to avoid suffocating the economy.
“High inflation without an adequate response from monetary policy would make the single European currency much less attractive on the foreign exchange market,” recalls Ulrich Leuchtmann, analyst at Commerzbank.