The yen and the euro fell due to the possibility of a US interest rate hike

The dollar rose on Tuesday after US Federal Reserve Chairman Jerome Powell raised the possibility of a 50 basis point rate hike, while the yen slipped below 120 yen to the dollar after the Bank of Japan reiterated its support for loose monetary policy.

The euro was also pressured, falling to its lowest level in nearly a week against the dollar.

The yen fell to a six-year low of 120.50 yen to the dollar, down 0.8 percent on the day, after losing more than 4 percent against the dollar this month as rising US bond yields and a growing trade imbalance dragged liquidity from Japan, the world’s third-largest economy.

The euro, affected by the Ukraine war and high oil prices, fell below the $1.10 level in early trading in London, but rebounded somewhat to stay down 0.1 percent and hit $1.1005 by 0900 GMT.

The dollar index rose 0.15 percent to 98.651.

With regard to cryptocurrencies, the price of Bitcoin jumped on Tuesday to its highest level in three weeks and recorded $ 42,528 in the latest trading, up 3.3 percent.

Goldman Sachs expects the US Federal Reserve to raise interest rates by 50 basis points for both its May and June meetings, after Fed Chairman Jerome Powell’s hawkish comments.

On Monday, Powell said the Fed should act “quickly” to raise interest rates and possibly “more aggressively” to prevent an upward price spiral from taking hold.

Analysts expect four more rate hikes of 25 basis points in 2022, one at every Federal Reserve meeting in the second half of this year, and three in 2023. However, analysts have left their projections for the Fed’s final interest rate unchanged. at 3%-3.25%.

The Fed raised interest rates last week for the first time since 2018.

Crude is now up 0.3% at $110.31 a barrel, while Brent crude is trading at $116.2 a barrel, up 0.53%. With Russia’s attack on Ukraine, the European Union imposed economic sanctions on Russia, but exempted oil and gas because Europe gets most of its needs from Russia.

There was no reaction from Russia to this situation, because Europe is a large trading market for Russia. But yesterday, after the news that the European Union would impose an oil embargo on Russia, oil prices accelerated. Today, the price of Brent crude reached $120, hitting its highest level since March 9th.