On Wednesday, the U.S. dollar rose. How about the Euro?
Today, the greenback was able to outperform most major currencies. However, the euro plunged by 0.14% and fell to 1.072 U.S. dollar. The euro soared to $1.103 per dollar on February 2nd, after a spike of 0.14% in the previous 10 months. It has been struggling to remain strong since then.
New data on Wednesday showed that inflation was high in the United States. Federal Reserve officials spoke afterwards about the monetary policy. According to reports the U.S. consumer price Index (CPI) inflation surged in January. As analysts predicted, it increased 0.5% overall. This is due in part to rising food and rental prices. Prices rose 6.4% year-on–year. While the inflation number is lower compared to the 6.5% reached in December, it’s still higher than economists’ expectations of 6.2%.
Jane Foley, the head of FX strategy at Rabobank, noted that the euro’s surge is connected with the CPI data. Fed officials’ recent comments also influenced the currency. Traders now expect the Fed to keep increasing its interest rates and reach a higher level than they had been contemplating one week ago.
The U.S. Dollar index rose by 0.25% Wednesday. Today, the U.S. dollar index traded at 103.51, after having ended the previous session flat.
