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Dollar Stays Pressured Amid Dovish Fed

Published on Oct 11, 2023 11:21

Dovish comments from Federal authorities on reduced expectations of a further rate hike is seen offsetting any gains in the dollar index on the back of safe haven demand amid Middle East tensions. The dollar index that measures the greenback against a basket of currencies continues to linger well below 106 mark alongside slide in benchmark US treasury yields. Federal Reserve Bank of Atlanta President Raphael Bostic reiterated that he doesn`t think policymakers need to raise interest rates any further and that policy is restrictive enough to bring inflation back to their 2% goal. Improving risk appetite in equities is also weighing on the greenback although geopolitical concerns could keep dollar somewhat supported. Investors now awaits crucial US PPI data and FOMC minutes that could provide further clarity on Fed course of action going ahead. Among the basket currencies, EURUSD and GBPUSD are both marching forward and currently quoting higher by around 0.10% at $1.0638 and $1.2297 respectively.

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