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Tuesday’s decline in the U.S. dollar was a sign of weakness. How about the Aussie? 

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The U.S. Dollar fell Tuesday. How about the Aussie? 

Today’s trading session saw the U.S. dollar trade in the red, with a sharp drop. The dollar traded close to the high levels of the previous session, thanks to positive U.S. data. This suggested that the Federal Reserve may continue to pursue a higher interest rate policy in the future.

The greenback saw its largest increase in two weeks on Monday. However, the dollar index declined by 0.1% to 105.05 against the basket today of six major currencies. On Monday, USD dropped briefly to 104.1, its lowest level since June 28. It rebounded to its highest point after data showed an unexpected rise in U.S. service industry activity last month.

Commerzbank’s FX Analyst, You-Na Park Heger, stated that the longer the American economic is strong, the more doubts will increase about whether the United States will experience a recession by 2023. Traders also speculate about the central bank’s policy decision.

December 15th will see the Federal Open Market Committee announce future rate hikes. Investors are betting on a half-point rise to a 4.25-4.5% policy band and a terminal interest rate slightly higher than 5%.



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