Dollar Steadies as Traders Assess Fed Outlook
The dollar index held around 100.2 on Friday, remaining close to seven-week highs as traders weighed the Federal Reserve’s policy outlook following its latest rate decision and amid softer oil prices. The index is heading for a weekly gain of more than 1% after the FOMC unanimously lifted the fed funds rate by 25 basis points to 3.75%-4%, marking its first increase in three years. Fed officials also indicated that additional tightening could come later this year as they seek to contain rising price pressures, with Chair Kevin Warsh noting that inflation remains elevated. The Bank of Japan is also expected to raise rates, while the Bank of England left borrowing costs unchanged on Thursday but cautioned that prolonged conflict in the Middle East could eventually require a rate hike. Meanwhile, oil prices extended their decline for a third session as Saudi Arabia worked to restore flows through its East-West pipeline, easing inflation worries.
2 on Friday, remaining close to seven-week highs as traders weighed the Federal Reserve’s policy outlook following its latest rate decision and amid softer oil prices. 75%-4%, marking its first increase in three years. Fed officials also indicated that additional tightening could come later this year as they seek to contain rising price pressures, with Chair Kevin Warsh noting that inflation remains elevated. The Bank of Japan is also expected to raise rates, while the Bank of England left borrowing costs unchanged on Thursday but cautioned that prolonged conflict in the Middle East could eventually require a rate hike.
Meanwhile, oil prices extended their decline for a third session as Saudi Arabia worked to restore flows through its East-West pipeline, easing inflation worries.