U.S. Dollar Climbs As Rate Cut Hopes Dim
January 09 2024 - 5:36AM
RTTF2
The U.S. dollar moved up against its most major counterparts in
the New York session on Tuesday, as investors awaited key inflation
data due later this week for clues on the Fed's rate
trajectory.
Hawkish comments from Fed officials prompted investors to scale
back their expectations for early interest rate cuts by the central
bank and lifted treasury yields.
Atlanta Fed President Raphael Bostic on Monday reiterated his
expectation of two rate cuts by the Fed this year.
Separately, Federal Reserve Governor Michelle Bowman backed
eventual rate cuts if inflation falls further towards the Fed's 2
percent target.
Market participants are pricing in about a 59.1% chance of a
rate cut by March, compared with a 69.6% chance last week.
The greenback climbed to 1.2707 against the pound and 0.8520
against the franc, off its early lows of 1.2765 and 0.8464,
respectively. The greenback may find resistance around 1.24 against
the pound and 0.90 against the franc.
The greenback edged up to 1.0928 against the euro and 0.6234
against the kiwi, from its early lows of 1.0966 and 0.6267,
respectively. The greenback is likely to find resistance around
1.06 against the euro and 0.60 against the kiwi.
The greenback was trading at 1.3401 against the loonie and
0.6689 against the aussie, up from its early 4-day lows of 1.3340
and 0.6734, respectively. The next possible resistance for the
currency is seen around 1.37 against the loonie and 0.64 against
the aussie.
In contrast, the greenback eased against the yen and was trading
at 143.87. This may be compared to a previous 5-day low of 143.42.
The greenback is poised to challenge support around the 130.5
level.
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