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Forex Today: Modest US Dollar comeback

Feb 09, 2023
Forex Today: Modest US Dollar comeback

As the excitement sparked by US Federal Reserve Chairman Jerome Powell waned over the day, the US dollar concluded Wednesday with a mixed performance. European stock indices were able to record minor gains, while Wall Street ended up losing money. The USD's rise was nevertheless constrained by the fact that US government bond yields stayed stable at Tuesday's closing levels.

The Euro, which is presently trading at about 1.0725, remains one of the US Dollar's weakest competitors. Officials of the European Central Bank (ECB) were repeating their harsh language over the wires.

Fed Governor Lisa Cook stated that because inflation is currently too high, the central bank is still concentrating on restoring price stability. She continued by saying that they would require a stringent monetary policy for a while. Additionally, John Williams, the president of the New York Federal Reserve, emphasised that the job market is still extremely robust and that there is still work to be done on rates, adding that data will determine the trajectory of rate increases. Last but not least, Fed Governor Christopher Waller issued a warning that interest rates may rise sooner than anticipated.

The GBP/USD exchange rate fluctuates around 1.2070 while maintaining modest intraday gains.

The freshly established Minutes of the Bank of Canada's most recent monetary policy meeting were released. The document had no effect on the CAD because the BOC indicated a stop in rate hikes after announcing its decision. Trading for USD/CAD is at about 1.3430.

Due to Wall Street's poor performance, the AUD/USD exchange rate has dropped to 0.6920. Finally, USD/JPY increased and is currently trading around 131.40.

Spot gold is currently trading at approximately $1,874 after reaching a new weekly high of $1,886.31 at the start of the day. Contrarily, the price of crude oil continued to rise, and a barrel of WTI is currently trading at $78.40.

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Aleksandra Kwiecien
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