The U.S. dollar on Thursday maintained its highest level in more than two months, supported by growing market expectations of a U.S. interest rate hike this year.
Interest rates unchanged
The Federal Reserve kept interest rates unchanged within the range of 3.50% to 3.75%.
However, about half of monetary policymakers expect to raise them later due to growing inflation concerns.
Strengthening the US currency
These expectations have contributed to the strengthening of the US dollar against major currencies.
Geopolitical tensions in the Gulf region also continued to affect investors’ risk appetite.
The euro rose slightly to $1.1511, while the pound climbed to $1.3318 after earlier declines.
Australian Dollar Rises
The Australian dollar rose 0.2% to $0.7025, and the New Zealand dollar rose by the same percentage to $0.5780.
The dollar index, which measures the greenback’s performance against a basket of major currencies, settled at 100.31 points.
In the previous session, the index recorded its biggest daily gain since early March.
In contrast, the Japanese yen fell to 160.760 yen per dollar, approaching a level that markets consider an area that could prompt Japanese authorities to intervene to support the currency.
The Bank of England is expected to keep interest rates unchanged at 3.75%, while continuing to assess the impact of economic and geopolitical developments on inflation rates.
