Currency markets have been shaken by a statement by Federal Reserve (Fed) Chairman Jerome Powell who said the central bank would discuss to accelerate a reduction in bond -buying purchases at a December policy meeting.
Shortly afterwards, the US dollar giant soared in hopes that once the program ended, the central bank might raise its interest rates.
At the time of writing, the dollar index traded higher at 96.03 against its main competitor, down slightly from the highs reached in the previous session at 96.64.
Not only that, Powell also expressed his concern over the growing risk of inflation. The newly discovered variant of the Omicron coronavirus is said to cause inflationary risk pressures to last longer.
Powell, who testified before Congress at an earlier New York session, said he thought the monthly bond purchase rate cut could move faster than the original schedule for the $ 15 billion -a -month reduction announced this month.
Following that, other major currencies plunged significantly in the previous session following the strengthening of the US dollar.
The pound plunged to its latest low this year, bringing it to trade below the 1.3300 price level in today’s Asian session. The euro fell to its lowest level since July 2020.
