Dollar Index clocks two-week high as Fed keeps alive Dec rate hike
The Dollar Index clocked a two-week high of 92.70 during the overnight trade and remains bid around 92.60 in Asia after the Federal Reserve kept alive the chance of a December interest rate increase.
Aside from planning to start the balance sheet rolloff in October, 11 Fed officials see one more hike in 2017, 4 more than in June.
Kathy Lien from CK Asset Management says, ” The unambiguously hawkish monetary policy outlook caught many investors by surprise and sent the dollar soaring against all of the major currencies. She adds, ” EUR/USD fell the most as it traded above 1.20 ahead of the announcement, but USD/CHF and USD/JPY also experienced sizeable gains”.
Adam Button believes, ” The market doesn’t believe in the Fed’s aggressive path and the Fed has frequently overstated the path, but even two hikes in the next 15 months may be sufficient for a sustained USD bid.