The US dollar rose slightly with the end of trading yesterday and the beginning of today’s session, in the wake of the Federal Reserve keeping interest rates unchanged as expected. Additionally, the FED stated that inflation was likely to rise in 2018, but with tightened monetary policy priced in, the markets will be eyeing economic data to see if it will provide adequate support for the US dollar.
The dollar index remained stuck near a 3-year low to trade at 89, after hitting its worst monthly performance since July 2016. Investors will be looking towards employment data on Friday to help the dollar rebound.
Yesterday's Fed meeting was the last under Janet Yellen, before Jerome Powell takes over.
The greenback shed some of its gains against the euro, as the EURUSD returned to the 1.24 level again, and in January the single currency rose by 3.5% to its highest level in 3 years against the US dollar on expectations that the ECB will abandon its easing policy this year.
Against the Japanese yen, the greenback continued to rise for the second day in a row to reach 109.60 levels after the USDJPY hit a four-month low of 108.27. The US dollar fell by 3.1% against the Japanese yen as a result of US trade protectionism, as well as the Bank of Japan's willingness to give up its easing policy.
