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The dollar rose against a basket of currencies on Wednesday, January 27th, as markets awaited comments by US Federal Reserve Chairman Jerome Powell, who is likely to renew his commitment to a super-easing policy.
The dollar compensated for declines against riskier currencies, even as hopes for a pandemic recovery received a boost from the International Monetary Fund raising its forecast for global growth in 2021.
Treasury yields, which have supported the dollar’s rise since the start of this year, fell overnight in light of caution about the final size and delays facing a fiscal stimulus plan of about $ 2 trillion proposed by President Joe Biden.
Powell is due to hold a press conference after the Fed’s two-day monetary policy meeting, which ends Wednesday.
The dollar index rose 0.1% to 90.2 on Wednesday in Europe, after dropping 0.2% in the previous session.
The pound rose to its highest level since April 2018, to $1.3753, before dropping slightly in trading.
The Australian dollar fell 0.2% to 77.3 US cents, to shrink a 0.5% gain on Tuesday. The euro fell 0.1% to $ ]1.2.
Analysts said that published reports stated that the European Central Bank is studying whether the differences from the US Federal Reserve policy support the euro, as part of a broader review of financing conditions, will not have a tangible impact on the single currency.
