FOREX
The US dollar rose during early Friday trading and looks set to close the week with gains for the first time in over a month. The release of earnings figures for large US banks surprised to the upside, easing fears over the stability of the banking sector. Markets have been apprehensive since the collapse of SVB, which many saw as having its root cause in the steep interest rate increases of the past year. In the last five days we’ve also had statements from several senior Fed officials, who reiterated the central bank’s commitment to fight stubbornly persistent inflation, strongly hinting there will be at least one more interest rate hike in May. While the recent gains in the dollar are not surprising given the current backdrop, they should not be seen as a signal of further advances. In the medium to long term, the outlook for the greenback is bearish as other central banks, such as the ECB, look set to continue to tighten monetary policy after the Fed's anticipated pause in May.
Ricardo Evangelista – Senior Analyst, ActivTrades
Source: ActivTrader
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