Dollar gets little lift from boost in Fed hike expectations
Traders raised the odds of a September rate hike to about 60% after stronger US payrolls, while the dollar index barely moved, analysts said.
- On Monday, the U.S. dollar struggled to maintain gains despite rising bets for a Federal Reserve rate hike, as geopolitical tensions and concerns over U.S. debt pressured the greenback.
- Escalating tensions in the Middle East, including Iran's reported targeting of oil tankers in the Strait of Hormuz, have stoked fears of prolonged energy disruptions and broader inflationary pressures.
- Traders priced in a roughly 57% chance of a Federal Reserve rate hike this month following strong nonfarm payrolls data, while Elias Haddad, global head of markets strategy at BBH, said a "hot CPI print would all but seal a September hike."
- The Japanese yen rose more than 0.2% on Monday, extending gains from last week, as Eric Robertsen, global head of research and chief strategist at Standard Chartered, warned the "recent burst" of strength threatens carry trade outperformance.
- Spot gold traded lower at US$4,426.67 an ounce as the European Central Bank is expected to lift rates to 2.75% on Thursday, while markets price a 75% chance the Bank of Japan will raise rates on September 18.
13 Articles
13 Articles
The United States dollar fell today, despite the growing expectations of higher interest rates in the United States, amid rising tensions in the Middle East and the inflationary pressures that it could exert on central banks around the world to tighten their monetary policies.
The Dollar Is in No Hurry to Gain Ground - ActionForex
The US dollar failed to capitalise on strong US labour market data. In August, non-farm payrolls rose by 162,000, three times the consensus forecast. The figures for June and July were revised upwards by 55,000. The unemployment rate held steady at 4.1%. Such figures allay FOMC officials’ fears that a rate hike could cause the labour market to freeze. The path to monetary tightening is clear, yet the USD index is in no hurry to rise.
After the jobs report, the probability of a Fed rate hike jumped to 60%. A week later, we're at the same point.
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- 43% of the sources are Center, 43% of the sources lean Right
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