Investing.com – The dollar surged to a 20-year high again in European morning trade on Wednesday, after more hawkish comments from Federal Reserve officials and firmer U.S. bond yields added to recession fears.
As of 16:19 Beijing time (04:19 a.m. ET), the greenback, which measures the trend of the greenback against six trade-weighted major currencies, was up 0.30% at 114.388 and up 0.18% at 114.31 after rising to 114.722 earlier. The benchmark U.S. Treasury yield was at 3.990 percent after rising to 4.019 percent earlier.
It has made it clear that containing the inflation surge is the most important task at present, and it will continue to raise interest rates sharply, even at the cost of a recession.
Chicago Fed President Evans (Charles Evans), St. Louis Fed President Bullard (James Bullard) and Minneapolis Fed President Kashkari (Neel Kashkari) on Tuesday (28) reinforced the above position. Bullard said rates need to stay high “for a while to make sure we’ve got inflation under control.”
Hawkish comments from Fed officials pushed the benchmark U.S. Treasury yield above 4% for the first time since 2010, and is now back at 3.982%.
It was down 0.50% at 1.0678, still near a record low, as the new UK government’s aggressive tax cuts plan continued to weigh on the market.
In addition, the International Monetary Fund (IMF) publicly criticized Britain’s economic policy on Tuesday, saying, “Given the rising inflationary pressures in many countries such as the United Kingdom, we do not recommend a large-scale and untargeted fiscal plan at this juncture, because the fiscal It’s important that policy doesn’t run counter to monetary policy.”
After the pound tumbled, Bank of England chief economist Huw Pill also said on Tuesday that the central bank may raise interest rates “significantly” at its November meeting.
It fell 0.19% to 0.9574, not far from its recent 20-year low of 0.9528, as the escalating energy crisis weighed on the euro.
Gazprom (MCX: ) said late on Tuesday it may seek sanctions on Ukrainian gas pipeline operator Naftogaz Ukrainy, a move that would end nearly all remaining Russian gas supplies to the European Union.
Earlier, two Russian natural gas pipelines had major leaks, and the outside world speculated that the leak was man-made.
In addition, the data showed a record low, falling to -42.5 from -36.8 in September, well below market expectations of -39.0.
It fell 0.09% to 144.63. After Japan intervened in the exchange rate last week, the US-Japan exchange rate fluctuated around 145.
Risk-sentiment-sensitive fell 0.62% to 0.6394, near its lowest level since May 2020, while it rose 0.95% to 7.2459 as the yuan fell to its lowest level since the 2008 financial crisis.
[This article is from Yingwei Caiqing Investing.com, to read more, please log on to cn.investing.com or download Yingwei Caiqing App]
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Compilation: Liu Chuan