U.S. Dollar Eases as Fed’s Interest Rate View Weighs

The dollar stumbled on Friday, capping its worst weekly performance against the euro in more than two years, pulled lower by expectations U.S. interest rates will rise more slowly than previously expected.

The greenback also ended the week on a sour note against other currencies, with its largest weekly decline in two months against the Swiss franc and yen, two days after the Federal Reserve downgraded its forecasts for growth, inflation and interest rates. That doused investor expectations of a June tightening.

Jens Nordvig, Nomura’s head of global foreign exchange, said one major reason for the sharp reduction in the Fed’s rate forecasts was the strengthening of the dollar since the U.S. central bank’s policy meeting in December.

CNBC

Content is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Business Information & Services, Inc. or any of its affiliates, subsidiaries, officers or directors. If you would like to reproduce or redistribute any of the content found on MarketPulse, an award winning forex, commodities and global indices analysis and news site service produced by OANDA Business Information & Services, Inc., please access the RSS feed or contact us at info@marketpulse.com. Visit https://www.marketpulse.com/ to find out more about the beat of the global markets. © 2023 OANDA Business Information & Services Inc.