The U.S. dollar was trading higher against major rivals on Wednesday, a bullish reflection of upbeat economic outlooks from Federal Reserve Chairman Jerome Powell and the central bank’s Beige Book report.
Powell reiterated the likelihood for gradual interest-rate tightening, suggesting the Fed was on track to raise rates twice more before the end of 2018. Meanwhile, the central bank’s periodic review of the economy known as the Beige Book was notably more optimistic than just a few months ago.
The ICE U.S. dollar index
DXY, +0.13%
which measures the buck against a basket of six other currencies, was up 0.2% at 92.087. The gauge, which weights the euro as its most significant component, is up 3.2% so far this year. The WSJ Dollar Index
BUXX, +0.11%
which measures greenback against 16 currencies, was also up 0.1%.
The U.S. dollar continued to strengthen against the euro, with the shared currency
EURUSD, -0.1800%
falling to $1.1646 from $1.1664 late Tuesday in New York.
Meanwhile, the pound also weakened against the greenback, with sterling
GBPUSD, -0.4346%
slipping to $1.3054 from $1.3116 late Tuesday in New York. The pound’s slide comes amid signs that inflationary pressures in the U.K. are easing, which may make the Bank of England think twice about raising its key rate by 25 basis points, as is still expected by market participants.
U.K. consumer prices rose 2.4%, unchanged from May and missing expectations of a 2.6% reading. Core inflation slipped to 1.9%, falling below the Bank of England’s 2% target.
On the U.S. data front, housing starts in June dropped by 12.3% from numbers in May, which were also revised lower, and were 3% lower than year-ago levels.
Source : MTV
