This week the market led to the decision-making meetings of the world’s main central banks, among which the United States Federal Reserve (Fed) is the most watched. The US dollar index fluctuated on Monday (19th), and worries about a sudden interest rate hike once drove Bitcoin below $19,000.
In late New York trade, the ICE US Dollar Index (DXY), which tracks the greenback against six major currencies, was down 0.19% at 109.55. DXY once again rose above 110 during the session, and is up nearly 15% so far this year, on track for its best annual performance in 38 years.
Markets were generally thin as markets in the UK and Japan closed on Monday. Global equities are on a tight leash, while the dollar remains firm on expectations that the Fed will maintain aggressive tightening until next year.
Fed fund futures markets are pricing in an 81 percent chance of a three-yard hike this week and a 19 percent chance of a four-yard hike, Refinitiv data showed.
Amo Sahota, executive director of Klarity FX, said: “Is the dollar going to strengthen further ahead of the FOMC meeting? I think the market will pull back a bit here and do some consolidation.”
In addition to Japanese and British stocks on Monday, global markets have taken several holidays this week. Australian stocks will be closed for one day on Thursday, and Japanese stocks will be closed again on Friday due to Respect for the Elderly Day , which can reduce market liquidity and cause price volatility. .
Elsewhere, the euro rose 0.1% to $1.0025, while the pound was up 0.1% at $1.1429, still hovering near a 37-year low.
The New Zealand dollar fell 0.47% to 0.5957 to the US dollar, hitting its lowest level since May 2020 during the session; the Australian dollar reached 0.13% to US$0.6727 against the US dollar; the Canadian dollar fell to a near 2-year low against the US dollar and turned red in late trading It was up slightly at C$1.3251.
The yen edged down 0.2% to 143.18 yen against the dollar, as hawkish comments from officials on currency intervention kept the yen hovering near the 145 resistance point.
The Bank of Japan will announce its interest rate decision on Thursday, and the market is widely expected to maintain ultra-loose monetary policy. However, given that the Bank of Japan has recently withdrawn its argument that “the rise in inflation is only a temporary phenomenon”, the policy turning point may come sooner than originally expected.
The yuan closed at a new 26-month low on Monday and depreciated below the key psychological level of 7.
Jitters over rising interest rates hit cryptocurrencies, with bitcoin falling below the $19,000 mark to a 3-month low on Monday, recovering slightly at $19,498 by press time; ether rebounded from a 2-month low, up 3% to $1,371 Dollars.
From Tuesday (20th) Taiwan time around 6:00 Price:
- The dollar index was 109.5925. -0.0704%
- The euro/dollar (EUR/USD) exchange rate was quoted at $1.0025 per euro. +0.0999%
- The British pound was quoted against the dollar (GBP/USD) at $1.1432 per pound. +0.1138%
- The exchange rate of the Australian dollar against the US dollar (AUD/USD) was quoted at 1 Australian dollar to 0.6727 yuan. +0.1340%
- The US dollar against the Canadian dollar (USD/CAD) was trading at 1.3248 Canadian dollars. -0.1056%
- The US dollar against the Japanese yen (USD/JPY) was at 143.21 yen per dollar. +0.2099%