Home EXPAT COMMUNITY Forex update week 37

Forex update week 37

The Euro rose to over a three-week high against the Dollar.

on Monday, whilst the Pound hit its highest this month as officials at the European Central Bank (ECB) drove home the case for additional aggressive monetary tightening. The single currency reached $1.0130 in early Asian trade, before standing 0.32% higher than Friday at $1.0079. Sterling reached $1.1681, and at the time of writing rose 0.23% at $1.1610. ECB policymakers are cautions of a mounting risk they will have to hike the key interest rate to 2% or more to curtail soaring inflation within the eurozone, Reuters reports. Bundesbank President Joachim Nagel said during an interview over the weekend that if the consumer price outlook doesn’t change, “further clear steps must follow.”

Moreover, the Dollar remained not far away from a fortnight-low against a basket of major rivals, ahead of U.S. inflation data out this week that could allow the Federal Reserve room to slow down the pace of rate increases at its upcoming meeting on 21st September. There was little change to the Dollar index on Monday morning, standing at 108.78, after edging down from a 20-year high of 110.79 reached last Wednesday. The index fell to its lowest level since 30th August at 108.35 in the previous session, the Reuters news agency report adds.

Federal Reserve Governor, Christopher Waller said he supports “a significant increase at our next meeting,” while St. Louis Fed President James Bullard echoed his call for a 75-basis point hike. “Officials have clearly articulated the need for the FOMC to keep raising interest rates until there is compelling evidence that inflation is falling,” said Commonwealth Bank of Australia strategist Joseph Capurso. “Regardless of the outcome of the CPI report, we judge the FOMC has much more work to do,” meaning more upside for the Dollar over the short and medium terms, he added. In contrast, the greenback rose 0.36% to 143.215 Yen, moving back in the direction of a 24-year peak of 144.99 hit last week. Over the weekend, Japanese officials indicated at intervention, with a senior government spokesperson stating steps must be taken to offset excessive declines in the Yen.

Elsewhere, the Australian Dollar edged down 0.23% to $0.6831, whilst the New Zealand Dollar was down 0.07% at $0.6099.

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