The dollar is strong this morning against both the pound and the euro, as it continues to be supported by the expectation that Federal Reserve policy makers will not introduce an ‘insurance’ rate cut this week. They will instead consider upcoming events, such as the G20 summit at the end of the month, before making a decision. This comes as the Fed meet for their monetary policy announcement on Wednesday.
The dollar strengthened on Friday to a near three week high, after the release of positive retail data. Purchases increased by 0.5% from the previous month. The April figure was revised to a 0.3% increase from the initial report of a 0.2% decline.
Despite the positive data, the Federal Reserve is still expected to cut interest rates this year, due to trade tensions and weak inflation reports.
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