Dollar falls as risk sentiment rises after Fed minutes
The U.S. dollar fell significantly on Thursday. This is because investors, convinced of the prospect of slower interest rate hikes by the Fed, began to bet on riskier assets.
Recently, the long-awaited results of the November 1-2 Fed meeting were announced. They indicate that officials were content to move to a less aggressive policy stance, Reuters reports.
Carol Kong, a currency strategist at Commonwealth Bank of Australia (CBA), noted that it is now almost certain that the FOMC will slow the pace of policy tightening from December. At the same time, the CBA expert warned that the markets are overly optimistic about the possibility of an imminent end to the tightening cycle. She also stressed that the U.S. dollar still has a strong support because of China's Zero-COVID policy.
U.S. markets will be closed on Thursday due to the Thanksgiving holiday, and liquidity is likely to be lower than usual.
The issue of inflation is currently of less importance in the foreign exchange market. Thus, according to economists at Commerzbank, dollar bears will not suffer losses even on the release of optimistic nonfarm payrolls.
Yesterday at 12:16 PMObviously there has been a structural shift in the markets toward a bearish dollar position. According to economists at Internationale Nederlanden Groep (ING), current U.S. nonfarm payrolls data may not cause an inversion of this trend.
Yesterday at 12:10 PMEuropean Central Bank President Christine Lagarde stated that inflation expectations should not change. People should be confident that price growth will return to the target level.
Yesterday at 11:56 AMCentral banks have recently been stepping up measures to combat global inflation. Investors, meanwhile, are actively discussing the continuation of high price levels amid limited supply.
Yesterday at 11:30 AMThe focus is on the OPEC+ meeting and the entry into force of bans related to the import of Russian oil.
Yesterday at 12:59 PM