Around 9:40 p.m., the greenback took 0.63% once morest the single currency, to 1.0727 dollars for one euro, following having climbed to 1.0710 dollars, the highest for almost a month.
The dollar remained conquering on Monday once morest all the major currencies, still surfing on the stunning US employment figures, published on Friday, which prompted traders to review their expectations in terms of monetary policy.
Around 8:40 p.m. GMT, the greenback gained 0.63% once morest the single currency, to 1.0727 dollars for one euro, following having climbed to 1.0710 dollars, the highest for almost a month.
The “greenback”, one of the nicknames for the dollar, also recorded one-month highs once morest the pound sterling (1.2006 dollars) and the yen (132.90 yen) once morest which it was up 0 respectively. .26% and 1.08%.
For Mazen Issa of TD Securities, the publication on Friday of the monthly US employment report was a shock for the dollar, which had been languishing since October.
According to the US Department of Labor, some 517,000 jobs were created in January in the United States, almost triple what was expected (187,000) by economists.
“At a minimum, this reinforces the idea of resilience” of the American economy and the feeling that the current trajectory does not correspond “to the classic scenario, which is that following a cycle of monetary tightening, we automatically expect rate cuts” in the process, said the analyst.
Thus, traders are now expecting two further rate hikes from the US central bank (Fed) of a quarter point each, once morest only one so far, but also a single cut of a quarter point therefollowing. in 2023, or even to a status quo until 2024.
Another sign of the recalibration of operators’ forecasts, the yield on one-year US government bonds jumped Monday to 4.8573%, its highest level in nearly 22 years.
“The market takes more seriously the prediction of the Fed which pleads for + increases (of rates) to come + and no decrease before next year”, commented, in a note, Joe Manimbo, of Convera.
Since the end of last year, currencies and markets in emerging countries and Europe have performed better than the dollar and Wall Street, as investors considered that they had been excessively discounted.
But now Mazen Issa sees the dollar going further than its recent surge, perhaps 2% to 3% once morest the euro, which would take it around $1.04.
