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ecb: Dollar continues to climb in Asia as Powell speaks, ECB loom

The dollars continued its rise in Asia on Thursday after falling back from two-decade highs overnight, as investors weighed the direction of global monetary policy ahead of the European Central Bank’s rate decision and comments from Federal Reserve Chairman Jerome Powell later in the day.

The US Dollar Index, which measures the currency against six major currencies, gained 0.1% to 109.80, rebounding to Wednesday’s high at 110.79, a level not seen since June 2002.

The greenback rose 0.18% to 144.09 yen, after hitting a 24-year high of 144.99 in the previous session.

The euro fell 0.21% to $0.9987, having hit a 20-year low of $0.9864 earlier in the week.

The ECB Many expected also to raise interest rates by 75 basis points (bps) late Thursday (12:15 GMT) to combat inflation, even though Europe’s energy crisis has sent the euro into a tailspin. under pressure.

The pound weakened 0.23% to $1.1509, back to a 37-year low of $1.1407.

Powell will participate in a panel discussion at a Cato Institute conference, with Fed officials set to enter a shutdown soon ahead of the US central bank’s September 20-21 meeting.

Recent rhetoric on the whole continues to be hawkish, with

Fed President Susan Collins Meanwhile, Fed Vice Chairman Lael Brainard commented that bringing inflation back to 2% overnight is the Fed’s “First Job”, while Fed Vice Chairman Lael Brainard commented that policy tightening currency will continue “as long as inflation can be brought down.”

Money markets set a 79% rate that the Fed will raise it by 75 basis points at this month’s meeting, which will raise the deposit rate from 3.0% to 3.25%.

“Dollar dominance could have one last major rally before the market can start betting long on some European currencies”, now the “global energy crisis” , widening interest rates and concerns about a severe Europe, Edward Moya, a senior market analyst at OANDA, wrote in a note.

“The upcoming ECB rate decision will be a make-or-break moment in FX that will either trigger a rally towards parity or provide a clear direction towards 0.9750.”

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