Dollar is falling and the euro is close to its highest level in 9 months

The dollar hovered near a nine-month low against the euro on Tuesday and gave up recent gains against the yen, as traders weigh the prospects of a US recession as well as the Federal Reserve’s interest rate path.

The dollar index, which measures the US currency against a basket of six other currencies, including the euro and the yen, fell 0.12 percent to 101.89, and is heading back to its lowest level in seven and a half months, which it recorded last week.

The euro rose 0.08% to $1.0880, close to Monday’s peak of $1.0927, the highest since April.

The single European currency is receiving support from comments from European Central Bank officials that point to more aggressive monetary tightening in the coming period.

The latest such statement was made on Monday by European Central Bank President Christine Lagarde who reaffirmed that the bank will continue to raise interest rates quickly to curb inflation, which remains very high.

The dollar fell 0.41 against the yen to 130.11, after two sessions of strong gains.

And the pound sterling rose 0.12 percent to $ 1.2391.