US Dollar Rebounds! CPI Data and Politics Keep Markets Hesitant
The US dollar rebounded to near a one-month high in early Asian trading on Wednesday after US inflation data matched expectations. This data reinforced expectations that the Federal Reserve would keep interest rates unchanged at the end of the month, despite pressure from the White House to lower them. The US dollar index rose 0.3% to 99.18, recovering losses from Monday, which were impacted by President Trump's threats against Fed Chairman Jerome Powell.
Global central bankers and CEOs of major Wall Street banks supported the Fed's independence, stressing that political interference could trigger higher inflation and increase government funding costs. Markets were cautious, awaiting clearer signals, but expectations remained that the Fed would keep interest rates steady. Data showed US consumer prices rose 0.3% in December, driven by higher rents and food costs as the effects of the previous government shutdown began to subside.
In the currency market, the US dollar held steady at 159.025 Japanese yen after the yen weakened on speculation of a snap parliamentary election by Prime Minister Sanae Takaichi. The dollar also held steady against the Chinese yuan at 6.9708 ahead of December trade data, and strengthened slightly against the Australian and New Zealand dollars. The euro and British pound remained stable at their respective levels.
Meanwhile, crypto assets also responded to market movements. Bitcoin rose 1.8% to $95,752, hitting a two-month high, while ether surged 4.0% to $3,334. These gains indicate that investor interest in alternative assets remains high as the dollar strengthens and the market holds its breath awaiting developments in the US economy and politics. (az)
Source: Nwesmaker.id
