Forex

Dollar recovers from 2-week low as bets for significant rate cut fell

2019-07-19 12:37:24 GMT (Economies.com)

US dollar rose on the European market on Friday against a basket of global currencies, about to achieve the first gain in the last three days, to recover from the lowest level in two weeks recorded earlier in yesterday's trading, the rise comes with renewed purchases of the US currency after the decline of the prospects for the Federal Reserve to make a significant cut in interest rates during the end of the month.

 

The dollar index rose more than 0.3% to 97.03 points, from the opening level of today's trading of 96.82 points, with the lowest level at 96.76 points.

 

The index ended lower by 0.5% yesterday, the second daily loss in a row, reaching a two-week low of 96.67 points as the market's sell-off accelerated after John Williams' remarks.

 

New York Federal Reserve Chairman John Williams said that the US central bank must "act quickly" to counter the economic slowdown and weak inflation, adding that it is better to take preventive measures rather than wait for a disaster.

 

Following Williams' comments, prospects for the Federal Reserve's interest rates cut by 50 basis points jumped to 70 percent leading to a large sell-off of the US dollar.

 

But the odds soon dropped to about 40 percent after a Federal Reserve spokesman told CNBC that Williams' comments were part of an academic talk and were not related to possible monetary policy actions.

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