The dollar is stronger this morning against the pound, euro and other currencies after the Federal Reserve’s press conference yesterday, which concluded its two-day monetary policy meeting.
The Fed left interest rates unchanged as expected. However, the comments that followed had a ‘hawkish’ and more upbeat tone, indicating that the health situation had improved and that officials would begin to discuss steps to reduce bond purchases.
The Fed’s new projections also suggest that two rate hikes are expected in 2023, which is more optimistic than the original projection of 2024.
Despite this, Fed Chair, Jerome Powell did say that COVID-19 variants remain a risk to the US economy and that inflation could turn out to be higher and “more persistent” than expected.
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