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26.06.2019 12:23 PM
The dollar is expected to return to growth, but will it last long?

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As expected, the dollar rose against the background of aggressive comments of representatives of the Federal Reserve System. The head of the Fed Jerome Powell stressed the independence of the Central Bank from the opinion of US President Donald Trump, who insists on lowering rates. The President of the Fed of St. Louis James Bullard, who is considered one of the leaders of the "dovish", surprised investors, saying that the reduction of rates by 50 basis points "will be premature". Recall, the dollar fell last week after officials started talking about lowering rates in the coming months. Some traders thought that the Fed could cut rates by 50 basis points next month. However, yesterday's comments brought down these expectations, pushing the dollar up from three-month lows against a basket of major currencies. The greenback rose 0.1% to 96,273 points. But the rebound will probably be short-lived. There is every reason to believe that the markets are ready for a weaker dollar. For example, against the Japanese yen, traders make large volume option bets between 107.50 and 107.00 yen.

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The New Zealand dollar was the strongest player against the US dollar. Kiwi rose 0.4% to $0.6661, after the Reserve Bank of New Zealand left rates unchanged at 1.5%, although it signaled a possible decline. At the same time, the pound remains near five-month lows at the level of 1.2669 dollars, after Boris Johnson, the leader of the race for the post of British Prime Minister, confirmed his commitment to leave the European Union with or without the agreement by October 31.

Irina Maksimova,
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