US Dollar Holds Steady Near 18-Month High Following Federal Reserve Minutes

Monetary Tightening Worries Traders

The US dollar held steady near its highest level today. The currency reached an 18-month high during quiet Asian trading sessions. The minutes of the Federal Open Market Committee meeting drove the stability. The minutes showed a clear tendency toward continued monetary tightening measures. Federal Reserve policymakers consider inflation the biggest risk affecting their economic outlook. The dollar index held steady at 102.23 after rising 0.3 percent earlier. The dollar remains very close to its strongest level since April 2015. Market turmoil triggered by the announcement of new tariffs pushed valuations higher.

Divisions Over Interest Rates

Federal Reserve policymakers voted unanimously to raise interest rates recently. They increased the rate by a quarter of a percentage point. However, the newly released minutes showed internal divisions over the decision. Officials debated the specific economic reasons justifying the recent rate hike. The minutes did little to change expectations regarding the next meeting. Markets believe the Federal Reserve will refrain from raising rates again soon. Against the yen, the dollar fell 0.2 percent to 157.815 today. New economic data showed Japan's current account surplus reached 4.062 trillion yen.

Tracking Other Major Currencies

This figure exceeded the average economist forecast of a 3.19 trillion surplus. The Australian dollar and New Zealand counterpart settled slightly lower today. Against the Chinese yuan, the dollar settled at 6.7015 in offshore trading. The euro settled at $1.1201, facing pressure from European debt concerns. The pound sterling also remained relatively unchanged at $1.3215 during trading. In the cryptocurrency market, Bitcoin fell 0.2 percent to $83,233.40. Ether also dropped 0.1 percent to trade at $2,571.07. Keep track of global financial trends and currency markets. Find comprehensive economic analysis today at Oman Day.