The US dollar traded higher against most of its major peers, though it was not able to beat all of them. Among the currencies that stood strong against the greenback was the euro, though currently EUR/USD is trying to move closer to the opening level.
The Dollar Index was up 0.13% as market participants continued to discuss the possibility of an interest rate hike from the Federal Reserve in summer. William Dudley, President of the New York Fed, added fuel to such talks yesterday, saying:
If I am convinced that my own forecast is sort of on track â then I think a tightening in the summer, the June, July timeframe is a reasonable expectation.
As of now, the probability of a June lift-off stands at 30% according to the CME FedWatch. While it does not look like a huge chance, it is important to remember that just recently the probability was in the neighborhood of 4%.
Today’s economic data from the United States added to the reasons to be bullish on the dollar, showing an increase of existing home sales last month that was bigger than market expectations.
EUR/USD traded at about 1.1207 as of 15:36 GMT today after opening at 1.1201 and rallying to the daily high of 1.1237. GBP/USD dropped from 1.4608 to 1.4517. USD/JPY rose from 109.95 to 110.51, trading at the highest level since the big crash on April 28.
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