FOREX
The US dollar index touched a two-month maximum during early Thursday trading as the markets continued to price in an extended period of high rates. The index, which measures the performance of the greenback versus a basket of other major currencies, rose after more positive US economic data was published on Wednesday, emphasising the resilience of the American economy, despite the elevated inflation and tighter credit conditions. Meanwhile, the latest Fed minutes, also released on Wednesday, revealed concerns amongst officials over the negative impact that further rate hikes may have on the economy. Against this background, another rate hike in September appears unlikely, but so does a 2023 cut. With the prospect of lasting high US interest rates, the dollar will likely remain supported, and there is scope for further gains in relation to its peers.
Ricardo Evangelista – Senior Analyst, ActivTrades
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