Dollar still near 7-month low as traders await Fed comments
Date
8/20/2024 9:17:26 AM
(MENAFN) The U.S. dollar remained close to a seven-month low in early trading on Tuesday, driven by expectations that the Federal Reserve may begin lowering interest rates next month. Market participants are eagerly awaiting remarks from Federal Reserve Chairman Jerome Powell, scheduled for Friday, which could influence future currency movements. This anticipated shift in U.S. monetary policy has led to a weaker dollar, benefitting other major currencies and driving significant changes in the forex market.
The euro reached its highest level of the year, trading at USD1.1080, after briefly touching USD1.108775 earlier in the session. This rise marks a notable 2.4 percent increase for the euro this month, putting it on track for its strongest monthly performance since November. The pound also held near a one-month high, trading at USD1.2985, just shy of its recent peak at USD1.2998. Additionally, an index tracking emerging market currencies hit a new record high, reflecting the broader strength of these currencies against the dollar.
The Japanese yen saw a slight increase, reaching 146.50 against the dollar, though it remains below the seven-month high of 141.675 seen in early August. Meanwhile, the dollar index, which gauges the greenback against six major currencies, fell to 101.82, its lowest level since January 2. This index has dropped more than 2 percent in August and is set to decline for the second consecutive month. The Australian dollar fell 0.12 percent to USD0.6725, while the New Zealand dollar remained relatively stable at USD0.61135. With Powell's speech at the Jackson Hole Symposium looming, investors are cautious, holding off on significant bets until further clarity is provided.
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