Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

Forex - Dollar Remains Broadly Higher on U.S. Rate Hike Hopes

Published 09/25/2017, 10:51 AM
Updated 09/25/2017, 10:51 AM
Dollar still on the upside, Dudley remarks support

Dollar still on the upside, Dudley remarks support

Investing.com - The dollar remained broadly higher against other major currencies on Monday, after comments by New York Federal Reserve President William Dudley sparked fresh hopes of a U.S. rate hike before the end of the year.

The greenback was boosted after Dudley said the Fed is on track to gradually raise interest rates given factors depressing inflation are "fading" and the U.S. economy's fundamentals are sound.

“I expect inflation will rise and stabilize around the (Fed's) 2% objective over the medium term," he said before adding that "in response, the Federal Reserve will likely continue to remove monetary policy accommodation gradually."

EUR/USD declined 0.65% to 1.1879 after Germany's federal election on Sunday showed growing support for a far-right party.

Chancellor Angela Merkel won a fourth term in office on Sunday but will have to build a coalition to form a government as Conservatives lost support in the face of a surge by the anti-immigration Alternative for Germany (AfD).

Earlier Monday, data showed that German business confidence edged lower in September. However, the reading remained close to the highest level on record, suggesting momentum in the euro zone's biggest economy remains strong.

GBP/USD held steady at 1.3507, recovering from moderate losses posted on Friday after UK Prime Minister Theresa May gave few new indications on how Brexit will proceed.

May proposed a transition period of around two years after the UK leaves the European Union, during which time access to the single market will continue on current terms.

Following May's speech, ratings agency Moody's downgraded Britain's credit rating to Aa2, saying government plans to reduce debt had been knocked off course and that Brexit would weigh on the economy.

Elsewhere, USD/JPY rose 0.17% to 112.18 and USD/CHF added 0.19% to 0.9711.

Also Monday, Japan's Prime Minister Shinzo Abe called a snap general election that will decide whether the country sustains its massive economic stimulus. The vote is set for October 22.

The Australian dollar was little changed, with AUD/USD at 0.7950, while NZD/USD retreated 0.89% to 0.7276 after no single party won a majority New Zealand's elections over the weekend.

The ruling National Party won the largest number votes, but neither of the major parties won enough seats to gain a majority in parliament, forcing a round of coalition talks that could last days or weeks.

Meanwhile, USD/CAD edged down 0.15% to trade at 1.2321.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.39% at 92.31 by 10:50 a.m. ET (14:50 GMT), the highest since September 21.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.