Dollar continues to rise amid expectations of interest rate cuts

On Wednesday, the dollar sustained an upward trend against a basket of peer currencies as traders assessed the possibility of the Federal Reserve implementing interest rate cuts.

According to the CME Group’s FedWatch tool, investors are indicating a 69 percent probability of a rate cut occurring during the Federal Open Market Committee meeting in March, followed by a 63.3 percent chance of another cut in May.

Atlanta Federal Reserve Bank President Raphael Bostic mentioned on Tuesday that he anticipates two interest rate cuts in the second half of the next year, emphasizing that there is “no urgency” at present. Thomas Barkin, President of the Federal Reserve Bank in Richmond, also noted that the economy’s performance will determine the feasibility of meeting expectations for interest rate reductions.

The dollar index rose by 0.13 percent to 102.25 after experiencing a decline of more than 0.3 percent on Tuesday. It had touched a four-month low at 101.76 last week.

In specific currency pairs:

• The euro declined by 0.19 percent to $1.0958.
• The British pound reached $1.2715 in recent trading.
• The yen stabilized at 143.73 against the dollar after a previous dip to 144.95.
• The Chinese yuan depreciated in foreign transactions against the US dollar to $7.1359.
• The Australian dollar remained mostly flat at $0.6766, just below its recent five-month high of $0.6777.
• The New Zealand dollar was recorded at $0.6276, after touching its highest levels since July 20 at $0.6282 earlier in the session.

In the cryptocurrency market, Bitcoin experienced a 1.6 percent increase, reaching $42,922.00.