The yield on two-year US Treasuries jumped to a 15-year high of 3.49%, boosting the US currency.
In the 20-year high strengthened today the dollar after the message sent by the president of the central bank of the USA (Fed), Jerome Powellthat interest rates will be kept at higher levels for longer to reduce inflation.
THE index of the exchange rate of the US currency against a basket of other major currencies climbed at 109.48 units.
Despite statements by European Central Bank officials over the weekend about decisive monetary policy, which boosted expectations for a very large interest rate hike in September, The euro was down 0.2 percentage points against the dollar at $0.99415near a 20-year low.
Sterling also fellwhich fell to $1.1649, a 2.5-year low.
Powell said at the annual meeting of central bankers in Jackson Hole that the Fed will raise interest rates as needed to curb growth and will maintain them at these high levels”for some time» to reduce inflation.
Money markets reacted by increasing bets on a more aggressive rate hike by the Fed in September, with the odds of them rising by three-quarters of a percentage point (75 basis points) to be now 70%.
The performance of two-year U.S. Treasury yields jumped to 3.49% which is a 15-year high, strengthening the US currency.
Speaking at the Jackson Hole symposium, ECB officials – including Executive Board member Isabelle Schnabel, French central bank chief Villeroy de Gallo and Latvian central bank governor Martins Kazaks – advocated a dynamic monetary policy.
Despite strengthening the possibility of a big ECB interest rate hike in September, the euro is struggling as the energy crisis plaguing Europe raises recession risks.
RES-EMP
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