The dollar index, which measures the value of the US dollar against six major world currencies, rose this week by 0.7 percent to 105.85 points.
At the same time, the dollar strengthened against the European currency, 0.4 percent, and the price of the euro fell to 1.0685 USD.
The dollar also rose against the Japanese currency, 1.4 percent to 151.5 yen (JPY), not far from the highest level of the year, Hrportfolio reports.
The dollar recouped some of its losses this week, when it fell sharply as investors concluded that the U.S. central bank’s interest rate hike cycle was over.
Well, this thesis was rejected by Fed President Jerome Powell, saying that further tightening of monetary policy is possible.
He said at the meeting of the International Monetary Fund (IMF) that he is satisfied with the weakening of inflation, but that he is not sure that the Fed has done enough.
“The Fed is determined to establish a sufficiently restrictive monetary policy to bring inflation down to the planned level.” “I’m not sure we’ve achieved that yet,” Powell said.
Besides Powell, many other Fed officials have said another rate hike is possible, given that inflation is still well above the Fed’s two percent target.
Next week, reports on consumer prices and retail sales for the United States (SAD) will be released, which could give new indications about whether there is a need for further tightening of monetary policy.
The market is still dominated by the idea that the Fed will not raise interest rates.
It is believed that the European Central Bank (ECB) will no longer raise interest rates, given that inflation in the Eurozone is gradually decreasing.