AGL 8.15 Decreased By ▼ -0.15 (-1.81%)
ANL 11.09 Increased By ▲ 0.14 (1.28%)
AVN 83.70 Increased By ▲ 4.00 (5.02%)
BOP 5.85 Increased By ▲ 0.10 (1.74%)
CNERGY 5.65 Increased By ▲ 0.01 (0.18%)
EFERT 80.22 Increased By ▲ 0.86 (1.08%)
EPCL 67.28 Decreased By ▼ -0.20 (-0.3%)
FCCL 15.20 Increased By ▲ 0.31 (2.08%)
FFL 7.23 Increased By ▲ 0.53 (7.91%)
FLYNG 8.06 Increased By ▲ 0.90 (12.57%)
GGGL 12.00 Increased By ▲ 0.40 (3.45%)
GGL 17.71 Increased By ▲ 0.20 (1.14%)
GTECH 8.78 Increased By ▲ 0.43 (5.15%)
HUMNL 7.23 Increased By ▲ 0.06 (0.84%)
KEL 3.74 Increased By ▲ 0.60 (19.11%)
LOTCHEM 32.10 Decreased By ▼ -3.10 (-8.81%)
MLCF 29.00 Increased By ▲ 0.65 (2.29%)
OGDC 86.05 Decreased By ▼ -1.65 (-1.88%)
PAEL 17.40 Increased By ▲ 0.77 (4.63%)
PIBTL 6.30 Increased By ▲ 0.25 (4.13%)
PRL 19.10 Decreased By ▼ -0.36 (-1.85%)
SILK 1.19 Increased By ▲ 0.05 (4.39%)
TELE 12.25 Increased By ▲ 0.84 (7.36%)
TPL 9.18 Decreased By ▼ -0.02 (-0.22%)
TPLP 20.70 Increased By ▲ 0.45 (2.22%)
TREET 26.95 Decreased By ▼ -0.15 (-0.55%)
TRG 97.75 Increased By ▲ 1.55 (1.61%)
UNITY 23.00 Increased By ▲ 2.15 (10.31%)
WAVES 14.10 Increased By ▲ 0.20 (1.44%)
WTL 1.31 Decreased By ▼ -0.03 (-2.24%)
BR100 4,389 Increased By 113.1 (2.65%)
BR30 16,099 Increased By 305.6 (1.94%)
KSE100 43,677 Increased By 804.8 (1.88%)
KSE30 16,532 Increased By 312.9 (1.93%)
Markets

Dollar slides to multi-month lows as Fed rate hike fears fade

  • US Treasury yields stalled as market participants grew increasingly confident that the Federal Reserve will hold off on hiking interest rates for the time being, despite worrisome near-term inflation spikes.
  • "That's going to be bearish for the dollar. You'll eventually see commodity-based currencies outperforming," Moya added.
Published May 18, 2021

NEW YORK: The dollar extended its slide on Tuesday, touching its lowest level since late February, as increased risk appetite lured investors away from the safe-haven greenback.

US Treasury yields stalled as market participants grew increasingly confident that the Federal Reserve will hold off on hiking interest rates for the time being, despite worrisome near-term inflation spikes.

"We're seeing this dollar weakness against numerous pairs and the market is starting to believe the Fed that we're going to have low interest rates a lot longer," said Edward Moya, senior market analyst at OANDA in New York.

"That's going to be bearish for the dollar. You'll eventually see commodity-based currencies outperforming," Moya added.

A spate of Fed policymakers are expected to speak this week and the US central bank is due to release the minutes from its April policy meeting on Wednesday, which will be parsed for any signs of a shift in its economic outlook and monetary policy.

"Normally everyone gets excited for the Fed minutes, but these minutes are old," Moya said. "We had a disappointing payrolls report and very hot CPI and PPI that happened after the meeting, most are focused on the raft of (Fed) speakers." The dollar index was last down 0.41% at 89.799.

The progress of COVID-19 vaccine deployment and easing of measures to contain the pandemic has lifted higher-risk currencies that stand to benefit most from economic revival.

The euro gained 0.51% to $1.2214, passing its highest level since Feb. 25, and the dollar fell 0.24% to 108.935 Japanese yen. The British pound, buoyed by the lifting of COVID-19 restrictions, rose past the $1.42 level for the first time since Feb. 24.

"What really has helped the pound is reopening momentum and willingness to become vaccinated," Moya said. "It's suggesting (the UK) recovery is going to stick. They're finally getting on the other side of Brexit."

Rising oil prices supported the Norwegian crown and helped boost the Canadian dollar to a six-year high.

Bitcoin edged higher but remained near the three-month low it hit after Tesla Inc boss Elon Musk dampened enthusiasm for the cryptocurrency over the weekend.

Rival digital currency ether jumped 3.62% to $3,404.

Comments

Comments are closed.