Let us check the market. On Wednesday, the United States central bankers will publish their first economic projections. This is a necessary step because of the recession the coronavirus pandemic plunged the country into.
For the next few years, estimates are expected to signal near-zero interest rates. Moreover, this year, estimates are also expected to signal a collapse in output.
Following the lifting of coronavirus restrictions, investors continue to cheer for the resumption of economic activity in both countries. Thus, against the greenback, the New Zealand and Australian dollars extended their recent rally.
Just shy of an 11-month high, the Australian dollar rose by 0.46% to $0.6990. Moreover, since late January, the New Zealand dollar also rose by 0.5% towards its highest value.
There was a decline for the dollar, of 0.6%, in the previous session. Furthermore, on Wednesday, the dollar fell to 107.37 yen.
In a month and a half, the Chinese yuan slightly pulled back from its highest level in a month and a half.
The situation in the United States
The Federal Reserve is having a meeting as traders eye treasury yields. There is speculation concerning the measures of yield control. The dollar appears weaker against the major currencies.
There is also speculation that the United States Federal Reserve might announce further steps forward. Later, on Wednesday, those steps might check the recent rise in bond yields. Against the United States dollar, amid that news, the euro remained below a three-month high.
Against the United States dollar, the single currency rose by 0.15% to $1.1354, just shy of $1.1384. That is its highest point since March 10.
There were hopes that the United States economic situation can recover faster than expected earlier this month. Thus, those hopes propped up United States government bond yields to their highest level in nearly three months and pushed the dollar up.
Meanwhile, concerning Federal Reserve decisions, most economists do not expect a change in interest rate policy.
- Trading Instrument