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بيديافس – The US dollar strengthened against other major currencies at the end of Friday’s trading (25/8/2023) after Federal Reserve Chair Jerome Powell signaled that the central bank may need to raise interest rates further to ensure controlled inflation. The dollar index, which measures the greenback against six other major currencies, rose 0.09 percent to 104.0776 after Powell’s statement.

“On Friday (25/8/2023) at the annual economic symposium in Jackson Hole, Wyoming, Powell stated, ‘Although inflation has come down from its peak… inflation is still too high.’We are prepared to raise interest rates further if necessary, and intend to maintain a tight policy stance until we are confident that inflation is moving down sustainably towards our target.”

In June, the Fed temporarily paused its fight against inflation due to concerns about the impact of banking stress on lending. There is a possibility that the central bank will choose to pause again in September, as they await additional data amid the uncertainty.

“We believe that the Fed is more inclined to take a wait-and-see approach with data and try to understand more about why the labor market remains strong, despite the inflation experience and higher interest rates in the economy,” said Sinead Colton Grant, Head of Investor Solutions at BNY Mellon.

After Powell’s speech, stocks fluctuated between gains and losses before moving stronger into positive territory. The yield on two-year US government bonds rose 3.8 basis points to 5.054 percent, while the yield on 10-year government bonds remained slightly unchanged at 4.239 percent.

At the end of New York trading, the euro fell to 1.0808 US dollars from 1.0809 US dollars in the previous session, and the British pound dropped to 1.2596 US dollars from 1.2607 US dollars.

The US dollar was bought at 146.3690 Japanese yen, higher than 145.8610 Japanese yen in the previous session. The US dollar declined to 0.8838 Swiss francs from 0.8845 Swiss francs, and increased to 1.3591 Canadian dollars from 1.3575 Canadian dollars. The US dollar strengthened to 11.0306 Swedish krona from 10.9889 Swedish krona.