Dollar Strengthens Following Fed Verdict
The USD/JPY and USD/CAD currency pairs are showing moderate gains following yesterday’s meeting of the US Federal Reserve. As expected, the American central bank kept its key interest rate unchanged. However, the tone of the accompanying statement and Jerome Powell’s comments were perceived by the market as less dovish than anticipated. Fed officials reaffirmed their willingness to maintain current rates for a longer period until there is clear evidence of easing inflationary pressure. The Fed Chair also noted that recent macroeconomic data does not provide sufficient grounds to begin a rate-cutting cycle in the coming months. These signals supported the US dollar and contributed to corrective moves in major currency pairs.
The USD/JPY pair has strengthened towards the 144.00 mark, reflecting the dollar’s overall resilience amid rising US bond yields. However, market participants remain cautious due to the potential for intervention by Japanese monetary authorities should the yen weaken further. The USD/CAD pair is trading above 1.38, still influenced by moderately weak oil prices and steady demand for the dollar.
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