2023-08-14 13:18:00
© Archyde.com. The dollar extends its gains to the highest level in 6 weeks
FXNEWSTODAY – The US dollar rose in the European market on Monday against a basket of global currencies, extending its gains for the third day in a row, hitting the highest level in six weeks, with continued buying of the currency as the best available investment.
Producer price data in the US has boosted the odds of one last additional hike in the Fed’s current rate hike cycle, with more evidence expected to emerge this week.
The American
The dollar index rose by 0.2% to 103.02 points, the highest level since last July 7, from today’s opening level of 102.85 points, and recorded the lowest level at 102.77 points.
The index ended Friday’s trading up by 0.2%, in the second consecutive daily gain, thanks to the Americans’ data.
The dollar index rose by 0.8% last week, its fourth consecutive weekly gain, within the longest series of weekly gains since last January, amid rising returns on US bonds.
Data on Friday showed US producer prices rose more than market expectations in July, due to the recovery in the cost of services at the fastest pace in nearly a year, casting some doubts over whether the Federal Reserve has finished its rate hike cycle.
ANZ analysts said US consumer resilience will be in the spotlight this week with the release of data for July, amid rising fuel prices and tightening credit conditions.
yield on US bonds
The ten-year yield rose today by about 0.7%, to continue its gains for the third consecutive session, about to reach the highest level of 4.204% since November 2022, which enhances investment opportunities in the US dollar.
This development in the US bond market comes amid increasing bets that the Federal Reserve will keep interest rates at historical levels for as long as possible in 2024.
In order to obtain more evidence on this point, investors are awaiting this week the issuance of the minutes of the last meeting of the US Central Bank, which was held on July 25-26, and resulted in the rapid resumption of the path of raising interest rates after the temporary pause in the June meeting.
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