The US dollar began to lose value against the US dollar and other major currencies on Tuesday after oil prices began to fall following indications of the development of the Covid-19 case in China to the point of limiting economic growth. At the same time ongoing talks to end the Russian-Ukrainian conflict are still ongoing.
The US dollar index, which measures the US dollar against major currencies, traded down nearly 0.2% to 98.873. Waima so the US dollar has strengthened nearly 3% since Russia invaded Ukraine on February 24th.
The euro and the British pound rose about 0.5% against the US dollar each but depreciated 0.2% against the yen.
The Brent crude oil futures market slumped 8% after concerns about supply dwindled by ongoing ceasefire negotiations and an increase in COVID-19 cases in China limiting economic growth, coupled with lower demand for oil.
It should be noted that the European economy and the Euro currency are among the most sensitive to the development of the war conflict and oil prices at the moment. According to currency analysts Commerzbank, the decline in oil prices reflects hopes that talks between Russian and Ukrainian negotiators may lead to an immediate and peaceful solution.
The market is now awaiting results and more indications from the Fed’s meeting on Thursday on interest rate policy in particular. The market wants to see if the Fed gives an indication of how quickly it will raise rates again
According to Matthew Ryan, a senior market analyst at Ebury that “the US dollar is at a fairly high level. The shock from the Fed will affect the growth of the US dollar ”.
