"Beyond July, we don't think there's going to be another hike, but the first cut would be in December," said Vassili Serebriakov, FX strategist at UBS in New York. It was on track for its weakest weekly performance since January. In afternoon trading, the dollar index edged up 0.1% to 102.24, after falling to a five-week low on Thursday. The survey's reading of one-year inflation expectations dropped to 3.3% this month from 4.2% in May. consumer sentiment to a four-month high in June. On Friday, data showed ebbing inflation expectations that lifted U.S. economic activity is slowing and inflation is cooling, challenging the Fed's still-hawkish stance. However, the Fed also signalled that rates may still need to rise by as much as 50 basis points by the end of this year. The ECB's policy decision came a day after the Federal Reserve left rates unchanged, snapping a string of 10 consecutive hikes. ![]() Sterling rose 0.4% to $1.2831 after earlier rising to its highest since April 2022, as traders ramped up bets the Bank of England will raise rates for the 13th straight meeting next week. The euro was flat against the greenback at $1.0940 after earlier touching a five-week high, having surged over 1% on Thursday following the rate hike and forward ECB guidance.ĮCB President Christine Lagarde told a news conference another rate hike in July was highly likely and the central bank still has "ground to cover" to stave off high inflation. data saw the dollar fall as traders scaled back bets on how high U.S. "The Bank of Japan added fuel to that dollar fire today by being on hold again," said Erik Bregar, director, FX & precious metals risk management at Silver Gold Bull in Toronto.Įlsewhere, the euro was poised for its best week against the dollar since June after the ECB raised borrowing costs to a 22-year high and hinted at further tightening. It was on pace for its largest daily percentage gain since late April. The dollar rose 1.1% against the Japanese currency to 141.795, after earlier touching its highest since November. It was poised for its biggest weekly decline against the euro in three years. The yen fell broadly following the decision and hit a fresh 15-year low of 155.22 per euro. The Japanese unit also fell against the greenback, dropping to a six-month trough.Īs widely expected, the BOJ maintained its -0.1% short-term rate target and a 0% cap on the 10-year bond yield set under its yield curve control (YCC) policy.īOJ Governor Kazuo Ueda said he expects inflation to moderate, but the "pace of decline is somewhat slow." NEW YORK, June 16 (Reuters) - The yen plunged to a 15-year low against the euro on Friday after the Bank of Japan (BOJ) kept its ultra-low interest rate policy and forecast that inflation will slow later this year, in contrast with the European Central Bank's (ECB) rate hike on Thursday. No major trading partner manipulated their currencies -Treasury.1-year inflation outlook falls -consumer sentiment survey Yen poised for largest weekly gain vs euro in three years.BOJ keeps rates unchanged, sinks yen broadly.
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