Breaking News
Investing Pro 0
NEW! Get Actionable Insights with InvestingPro+ Try 7 Days Free

Dollar weakens on Fed minutes; Euro awaits ECB news

Forex Nov 24, 2022 16:28
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters.
 
EUR/USD
-0.33%
Add to/Remove from a Portfolio
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
GBP/USD
0.00%
Add to/Remove from a Portfolio
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
USD/JPY
-0.15%
Add to/Remove from a Portfolio
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
AUD/USD
-0.20%
Add to/Remove from a Portfolio
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
NZD/USD
-0.13%
Add to/Remove from a Portfolio
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
USD/SEK
+0.59%
Add to/Remove from a Portfolio
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 

By Peter Nurse 

Investing.com - The U.S. dollar edged lower in early European trade Thursday, continuing the previous session's selloff after the minutes from the latest Federal Reserve meeting signaled a slowdown in future rate hikes.

At 03:05 ET (08:05 GMT), the Dollar Index, which tracks the greenback against a basket of six other currencies, fell 0.1% to 105.933, after sliding 1% overnight.

The dollar saw selling after the minutes from the latest Federal Reserve meeting revealed that a "substantial majority" of policymakers expected a slowing in the pace of rate hikes to soon be appropriate.

The Fed raised its key rate by three-quarters of a percentage point earlier this month, for the fourth straight time in an effort to tame soaring inflation, but the minutes largely cemented expectations for a 50-basis-point hike in early December.

EUR/USD rose 0.1% to 1.0407, benefiting from the dollar selloff as traders wait for the release of the account of the last European Central Bank meeting later in the session.

Eurozone inflation soared above 10% in October, but the November PMIs pointed to the region entering recession, creating a dilemma for the ECB policymakers.

The ECB will certainly raise its interest rates considerably, though how far it ultimately goes will depend on how the economic situation develops, the head of Germany's Ifo economic institute said on Tuesday.

"The ECB still has quite a long way ahead of it," said Clemens Fuest. "That's simply because it just started late."

Also of interest will be the German Ifo business climate index, with traders looking to see the degree of business confidence in the most important economy in the Eurozone.

GBP/USD rose 0.2% to 1.2078, adding to the previous session's 1.5% gain after preliminary British economic activity data beat expectations, even though it still pointed to an economic contraction.

Sterling has recovered strongly since falling to a record low of 1.0327 in September when the short-lived Truss government unveiled plans for large unfunded tax cuts.

Elsewhere, USD/JPY fell 0.6% to 138.79, with the yen trading close to a three-month high benefiting from the sharp fall in U.S. Treasury yields after the release of the Fed minutes.

The risk-sensitive AUD/USD rose 0.3% to 0.6748, while NZD/USD rose 0.1% to 0.6245, extended gains after the Reserve Bank of New Zealand raised interest rates by 75 basis points on Wednesday, its biggest ever rate hike.

USD/CNY fell 0.3% to 7.1485 after the Chinese government announced a rescue package for its troubled property sector while COVID-19 cases continue to rise.

USD/SEK fell 0.2% to 10.4379 ahead of the latest policy-setting meeting by Sweden’s central bank, with the Riksbank expected to increase interest rates to try and curtail higher than expected inflation.

"For a while it seemed as if the fastest price rises were behind us. Unfortunately, these hopes were dashed given the inflation outcome for October. Prices rose rapidly and across the board," said analysts at Nordea, in a note. 

"The numbers are likely to worry the Riksbank and reinforce the view that the policy rate will be raised by 75bp to 2.50%."

Dollar weakens on Fed minutes; Euro awaits ECB news
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
or
Sign up with Email