On Wednesday, the euro fell to its lowest level in a month to strengthen the dollar. The prospect of new Western sanctions on Russia increases pressure on the European currency. The euro was 0.15% lower against the dollar at $1.08900. After briefly touching the almost one month low of $1.08735. The United States and its allies prepared new sanctions against Moscow over the killing of civilians. President Volodymyr Zelensky called it a war crime.
A new round of sanctions against Russia should be announced today by the US and the EU. This will have some impact on energy exports under pressure from the euro. The dollar index, which measures the dollar against its six peers, rose to 99,600 for 0.12%. Since reaching its highest level in May 2020, a total of 99,759. The index rose 0.5% on Tuesday. After that, the governor of the federation said that he expected a combination of rising interest rates and a rapid outflow of balance. This would later lead to a more neutral US monetary policy stance. This year, with further tightening, if necessary.
Euro and Russia Sanctions
The 2-year yield in the US was at its highest level since January 2019. The 5-year result was the highest since December 2018. The benchmark 10-year interest rate has risen to its highest level since March 2019. The Fed will release the minutes of its March meeting later, likely releasing new details about its bond-cutting plans.
What matters now is what the Fed is doing in May… what signals it is sending this year about interest rates. Because the market has already appreciated interest rate hikes, confirmation of these expectations is likely only to have a “marginally positive impact on the dollar.” Sterling remained unchanged against the dollar at $1.30690 after the touch was three-week low against the dollar. Bitcoin fell 0.4% to a total of $45,305.