The US dollar was very strong on Monday as traders continued to bet on another interest rate hike from the Federal Reserve in the near future.
Macroeconomic data released over Monday in the United States was disappointing for the most part, but that did not deter the greenback from rising. What caught the traders’ attention was the fact that annual core PCE inflation was very close to the Federal Reserve’s target level of 2.0%. That fueled the outlook for a hike from the Fed in the very near future.
While there were no expectations of a rate increase at this week’s policy meeting, the CME FedWatch tool continued to show a 100% chance for a hike in June. What is more, it showed that the chance for another hike in September was at about 75%.
EUR/USD fell from 1.2123 to 1.2077 as of 21:54 GMT today. GBP/USD traded at 1.3765 after opening at 1.3771 and falling to the daily low of 1.3792. USD/JPY gained from 109.07 to 109.26.
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Dollar Continues to Get Support from Interest Rate Hike Expectations
