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US Dollar
Source: Newsmaker.id
The US dollar weakened slightly in Wednesday's trading (Sept 16) after rising for six consecutive sessions, yet it held near a more-than-one-week high. The Dollar Index hovered around 99.59 ahead of the Federal Reserve's interest rate decision.
Markets anticipate a roughly 92% probability that the Fed will raise interest rates by 25 basis points. The primary focus has shifted from the rate hike decision itself to comments from Fed Chair Kevin Warsh regarding whether the move is merely temporary or marks the beginning of a broader tightening cycle.
In Europe, the euro traded flat around US$1.1500, remaining near a nearly one-month low. Markets are still digesting the ECB's earlier decision to raise the deposit facility rate by 25 basis points to 2.50% to combat energy-driven inflationary pressures.
The pound sterling also remained relatively stable around US$1.3500 ahead of the Bank of England's decision on Thursday. UK inflation rose to 3.1% in August, while core inflation held at 2.6%, keeping the possibility of another BoE rate hike on the market's radar.
Meanwhile, the Japanese yen strengthened slightly after the USD/JPY pair touched 155.49 before retreating to around 154.97. Markets see an approximately 80% chance that the Bank of Japan will raise interest rates by 25 basis points to 1.25% on Friday.
Newsmaker Analysis: The dollar's next move will hinge largely on Kevin Warsh's tone. If the Fed signals the potential for further rate hikes, the DXY could maintain its upward momentum. Conversely, if the hike is viewed as a one-off event, profit-taking on long dollar positions could intensify—particularly against the euro and yen, both of which are supported by their respective central bank policies. (arl)
Source: Newsmaker.id