The dollar firmed overnight as markets absorbed the hawkish tone of the Federal Reserve’s split decision. Three committee members pushed to drop any language pointing toward future rate cuts – a meaningful signal that inflation is making the doves uncomfortable. Powell’s decision to stay on the Fed’s board will loom larger over time: it denies Trump an immediate vacancy and keeps the question of central bank independence firmly in the conversation. Today’s US first-quarter growth figures and March spending data at 13:30 could push the dollar further if they come in above expectations.
USD/GBP past year
For more on currencies and currency risk management strategies, please get in touch with your Smart Currency Business account manager on 020 3918 7255 or your Private Client account manager on 020 7898 0541.
