In late trading on Tuesday, the U.S. dollar decreased as Federal Reserve Governor Christopher Waller suggested that more rate hikes might not be necessary. This led to a 0.45 percent drop in the dollar index, which measures the greenback against six major peers, to 102.7465.
The Consumer Confidence index in November, reported by The Conference Board, surpassed expectations and revised October figures. Waller’s comments about reducing rates if inflation remains low for an extended period led to a decline in U.S. Treasury yields and the U.S. dollar.
Fed Governor Michelle Bowman remained hawkish, stating that she believes the Fed will need to raise rates further to bring inflation down to the 2 percent target in a timely manner. However, the change in Waller’s tone seemed to have a greater impact on the market as investors no longer anticipate additional hikes from the Fed.
Additionally, Chicago Federal Reserve Bank President Austan Goolsbee mentioned that overall inflation is decreasing at a rate not seen since the 1950s. New York Fed President John Williams also found it encouraging that inflation is declining, reaffirming the Fed’s commitment to reaching its inflation target.
In late New York trading, the euro rose to 1.0990 dollars from 1.0956 dollars in the previous session following comments from European Central Bank (ECB) member Joachim Nagel, who suggested the possibility of unwinding the ECB’s historic bond portfolio. The British pound also increased to 1.2698 dollars from 1.2631 U.S. dollars in the previous session.
The U.S. dollar was traded at 147.4240 Japanese yen, down from 148.6250 Japanese yen in the previous session. The U.S. dollar also fell to 0.8777 Swiss francs from 0.8802 Swiss francs, and it was down to 1.3568 Canadian dollars from 1.3623 Canadian dollars. Additionally, the U.S. dollar dropped to 10.3320 Swedish kronor from 10.4226 Swedish kronor.
