Fri, 08 Dec 2023

U.S. dollar rises as Feds remain hawkish

23 Sep 2023, 07:05 GMT+10

NEW YORK, Sept. 22 (Xinhua) -- The U.S. dollar rose in late trading on Friday, as Federal Reserve officials remained hawkish.

The dollar index, which measures the greenback against six major peers, increased 0.21 percent to 105.5876 in late trading.

"I continue to expect that further rate hikes will likely be needed to return inflation to 2 percent in a timely way," said Federal Reserve Governor Michelle Bowman on Friday.

She noted that Fed officials expect inflation to stay above 2 percent until at least the end of 2025, according to the median forecast policymakers submitted in quarterly economic projections released this week.

Boston Fed President Susan Collins also expressed support Friday for keeping interest rates elevated as the battle against too-high inflation continues. "I expect rates may have to stay higher, and for longer, than previous projections had suggested, and further tightening is certainly not off the table."

Also on Friday, S&P Global manufacturing purchasing managers' index (PMI) improved to 48.9 in early September from 47.9 in August, pointing to an ongoing contraction in the manufacturing sector's business activity at a softening pace.

The services PMI edged lower to 50.2 from 50.5 in the same period, and the composite PMI arrived at 50.1, down slightly from 50.2 in August.

In Asia, the Bank of Japan (BOJ) maintained ultra-low interest rates on Friday as expected.

"We have yet to foresee inflation stably and sustainably achieve our price target. That's why we must patiently maintain ultra-loose monetary policy. Having said that, we will of course shift policy if achievement of our target is foreseen. For now, the outlook for the economy and prices is extremely high," said BOJ Governor Kazuo Ueda.

In late New York trading, the U.S. dollar bought 148.3790 Japanese yen, higher than 147.5180 Japanese yen of the previous session. The euro decreased to 1.0648 U.S. dollars from 1.0662 dollars in the previous session, and the British pound decreased to 1.2242 U.S. dollars from 1.2291 dollars.

The U.S. dollar was up to 0.9067 Swiss francs from 0.9040 Swiss francs, and it rose to 1.3471 Canadian dollars from 1.3469 Canadian dollars. The U.S. dollar fell to 11.1118 Swedish krona from 11.1616 Swedish krona.

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