Hopes of seeing the US dollar strengthen again, were dashed when the giant currency returned to display weakness even after the testimony of Federal Reserve (Fed) Chairman Jerome Powell.
The weakness of the U.S. dollar followed a decline in 10 -year U.S. bond yields impacted by market concerns over the risk of a U.S. economic recession following the Fed’s aggressive measures to fight inflation.
In his testimony before the Senate Banking committee, Powell went on to reiterate the central bank’s commitment to lower inflation and that continued interest rate hikes will remain in place.
The next focus shifted to Powell’s testimony before a House of Representatives committee at today’s New York session.
Meanwhile, the UK consumer price index (CPI) once again hit a recent 40 -year high of 9.1% in May.
The figure also raises concerns about the recession as the central bank of England (BOE) needs to take steps to raise rates to curb it, but at the same time the people are also struggling with the rising cost of living.
In Canada, inflation jumped to 7.7% last month, the highest since January 1983. The reaction exhibited by the Canadian dollar was upbeat, but not significant.
The central bank of Canada (BOC) has raised rates up to three times, and the latest rise in inflation may force them to act again.
In the meantime, the market focus will also be on the publication of manufacturing and services PMI data from the European Zone and the UK during today's European session.
