The US Dollar Is Climbing Amid Speculation of a Fed Rate Hike
The U.S. dollar exhibited strength against the majority of major currencies during the European session on Tuesday, as market participants speculate that the Federal Reserve will implement two additional interest rate hikes within the year. Additionally, the CME FedWatch tool suggests a 60% probability that the Fed will increase interest rates by a quarter of a percent during the two remaining policy meetings this year. Investors will focus on the August JOLTS Job Openings data for the United States later in the day.
According to the US Job Openings report, employers in the U.S. posted 7.23 million new positions, which is marginally lower than the 7.271 million jobs posted in July. European stock markets experienced a decline as investor sentiment appears to be influenced by the recent increase in crude oil prices and the rise in bond yields. Concerns regarding artificial intelligence are anticipated to impact sentiment negatively.
In European trading today, the U.S. dollar appreciated to over a 3-month high of 1.1334 against the euro, reached a 4-month high of 0.8350 against the Swiss franc, and approached a 3-month high of 1.4200 against the Canadian dollar, moving up from early lows of 1.1372, 0.8319, and 1.4173, respectively. If the greenback extends its uptrend, it is likely to encounter resistance near 1.12 against the euro, 0.85 against the franc, and 1.43 against the loonie.
Against the pound, the greenback increased to 1.3224 from an earlier low of 1.3255. The greenback may test resistance around the 1.31 region. Looking ahead, Canada’s GDP data for July, U.S. The Redbook report, along with the U.S. S&P/Case-Shiller home price index for July, the U.S. Dallas Fed services index for September, and the U.S. Consumer Board’s consumer confidence index for September, are scheduled for release during the New York session.
