Against the euro, the greenback fell 0.25% to 1.1454 dollars while the European currency had earlier reached a peak since October at 1.1495 dollars.
The US dollar had a rocky day, jostled by high US inflation, first logically gaining momentum once morest the major currencies before falling back.
Against the euro, the dollar fell 0.25% to 1.1454 dollars while the European currency had earlier reached a peak since October at 1.1495 dollars, in reaction to the rise in prices in the United States. States which raises fears of a tougher-than-expected monetary tightening by the Fed.
Inflation continued to accelerate in January in the United States to reach 7.5% over one year, its fastest pace in nearly 40 years, according to the consumer price index (CPI) published by the Department of Labor.
“It’s really a weird session. It was difficult to explain the rebound of the euro, “recognized Shaun Osborne of Scotia Bank, while the weakness of the greenback also extended to the yen and the pound sterling.
The sharp fall of the New York Stock Exchange weighed on the price of the American currency.
Bond yields on Treasury bills jumped. The rate on ten-year debt climbed above the 2% mark, to 2.03%, for the first time since July 2019.
As for two-year rates, they climbed almost 15% to 1.56%, flattening the curve between short-term and long-term rates.
Some analysts saw the risk that the Fed might raise rates on the spur of the moment without waiting for its official monetary meeting on March 15-16, as a member of the Central Bank’s Monetary Committee, James Bullard, suggested on Thursday.
“Overall, it looks like we’re moving towards a more aggressive stance from the Fed, with a possible hike before March and the increased risk of a 50 basis point hike,” noted Shaun Osborne of Scotiabank.
For Christopher Vecchio, analyst for the specialized site DailyFX, there are signs that inflation should pass a peak in the next two to three months before reversing its curve.
“As supply chain bottlenecks improve, particularly at ports, inflation might return to around 6%, possibly lower, by the end of the first half of the year,” he added. the analyst.
