News Tech: Currency markets were quiet on Thursday, with investors awaiting key US inflation data to provide clues on the Federal Reserve’s tightening stance. So far this year, investor appetite for riskier assets has been thwarted by expectations that the U.S. Federal Reserve will begin tightening monetary policy, starting with rate hikes at his March meeting. I was. A strong rally helped global stocks rise Wednesday, but struggled to sustain that momentum during Thursday’s Asian and early European sessions.
That should push the dollar higher.” As of 08:25 GMT on that day, the Dollar Index was at 95.503 where he was down less than 0.1%. After the big swings of the past two weeks, this week has seen minimal week-to-week changes. Investors have priced in a 71% chance that the Fed will raise rates by 0.25 basis points at his March meeting, with up to five rate hikes for the year generally modest.
Markets focused on US inflation data due later in the session. The headline consumer price index is expected to rise more than 7% year-on-year in January, a level reminiscent of his 1970s and 1980s inflation shocks. “The higher the current inflation rate, the more recognition market participants have that the Fed must act more quickly, decisively and over the long term than currently expected,” said Commerzbank’s FX and EM analyst Antje Praefcke wrote in a note to clients.
But that changed last week when the EURUSD surged to a three-week high of $1.1483 when the ECB adopted a more hawkish stance at its meeting. At 0831 GMT, the euro was at $1.1428, little change for the day. European government bond yields continued to rise after sharply rising last week following what analysts called his ECB ‘pivot’. The Australian dollar, a measure of risk appetite, rose 0.1% to $0.71875, while the New Zealand dollar rose slightly.