Singapore: The dollar stayed strong, while crypto surged on ETF expectations. Fed rate cut speculation continues.
The dollar was strong on Tuesday, and the yen struggled below the 156 level. Trade was calm, with investors thinking about when and how much the Federal Reserve will cut interest rates this year.
Cryptocurrencies went up, especially ether, because the U.S. Securities and Exchange Commission might approve spot ether exchange-traded funds soon.
Against the yen, the dollar went up 0.11% to 156.41 in Asia.
The yen’s trading range was small in the last few sessions because Japanese authorities might stop the yen from going even lower. But the big difference in interest rates between the U.S. and Japan made the yen a good currency to borrow.
The euro went up 0.02% to $1.0859, and the pound went up 0.04% to $1.27115.
This week, there’s not much U.S. economic data to say where currencies will go. Investors are watching a lot of Federal Reserve speakers to learn about U.S. rates and when the cuts might start.
Many officials on Monday said the Federal Open Market Committee (FOMC) should be careful, even though last week’s data showed that consumer prices went down in April.
Carol Kong, a currency strategist at Commonwealth Bank of Australia, said,
“Officials will say similar things, with the main message to be patient on rate cuts.”
Even though the Fed is careful, investors still think rates will go down twice this year, starting in September.
The dollar stayed at 104.62 against other currencies. The New Zealand dollar went down 0.09% to $0.61005, and the Australian dollar went down 0.14% to $0.6658.
The Reserve Bank of Australia’s May meeting minutes, out on Tuesday, said the central bank didn’t change interest rates because they didn’t want to change policy too much.
But they said they might raise rates if inflation gets worse than they thought.
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