The dollar strengthened against a basket of major currencies on Wednesday (April 26) as the Federal Reserve (Fed) is expected to raise interest rates at its meeting next month. Meanwhile, as the euro continued to depreciate, there were fears that the European economy will be affected by the war between Russia and Ukraine.
- The dollar index against the six major currencies in a basket of currencies rose 0.63% to 102.9540.
- The euro was lower against the US dollar at $1.0563 from $1.0647.
- The pound fell to $1.2541 from $1.2589.
- The Australian dollar fell to $0.7121 from $0.7147.
- The dollar strengthened against the yen at 128.31 yen from 127.58 yen.
- The dollar strengthened against the Swiss franc at 0.9683 francs from 0.9623 francs.
- The US dollar was also stronger against the Canadian dollar at 1.2832 Canadian dollars from 1.2799 Canadian dollars.
Euro weakens amid concerns about the expansion of the European economy after Russia suspended natural gas exports to Poland and Bulgaria. Those had refused to pay for gas in rubles.
Meanwhile, the dollar remains positive as the Fed will raise interest rates quickly and sharply to curb inflation. Fed Chairman Jerome Powell said the Fed will act faster to fight inflation. And signaled that there is a likelihood that the Fed will raise interest rates by 0.50% at its May 3-4 meeting.
Markets also expected the Fed to raise interest rates by a larger 0.75% after May in an effort to curb inflation.
Regarding the U.S. economic data released last night. The National Association of Realtors (NAR) announced that its index of pending home sales fell 1.2% in March from the previous month.