The dollar rose on Wednesday to its highest level against the euro In almost 20 years after the United States Federal Reserve (Fed) increased its interest rates by 0.75 percentage points.
(See: Powell acknowledges that the labor market would worsen due to rate hikes).
The US currency reached 0.9814 dollars per euro for the first time since the end of October 2002, a few months after the circulation of the single euro zone currency began.
The NYSE, which had been in positive territory before the Fed statement, turned red on all three of its leading indicators after the announcement.
(See: The Fed raises interest rates by 75 basis points).
The Fed’s recent statement included higher rate projections for late 2023 and 2024 than it previously projected, indicating that it now sees the need for a longer monetary policy adjustment in the face of inflation trends.
“Overall, the message (from the Fed) remains aggressive, committing to more rate hikes to combat inflation and to keep inflation expectations anchored“, analyzed in a publication High Frequency Economics.
(See: Petition made by Colombia to a US senator on the fight against drugs).
AFP
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