Dollar Carves Out Gains with Help from Interest Rates Speculations

The US dollar edged higher today even without any important economic releases from the United States. The currency is supported by speculations about a possible interest rate hike from the Federal Reserve this year. The greenback was not able to outperform the Japanese yen.
The dollar resumed its rally yesterday and was able to keep the upward momentum on today’s trading session. Atlanta Fed President Dennis Lockhart said yesterday:

I expect tapering to continue at the pace we’ve seen since December with the result that the quantitative easing, or QE, program will come to a conclusion in the fourth quarter.

At the same time, he explained that the central bank is “not in a rush” to raise interest rates. Anyway, it is expected that US policy makers will start tightening monetary policy in the second half of this year.
The greenback also got help from US stocks as the Standard & Poor’s 500 Index was rising. Yet the currency is in danger from tomorrow’s report that is expected to show a decline of US gross domestic product.
EUR/USD dropped from 1.6334 to 1.3594, trading near the lowest level since February 13, and GBP/USD plunged from 1.6808 to 1.6707 as of 18:57 GMT today. Meanwhile, USD/JPY ticked down from 101.96 to 101.86, reaching the low of 101.63 intraday.

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