Daily market commentary: The US dollar hedges up as inflation fears continue to dominate the sentiment of investors

Forex

The US dollar hedged up during early Monday trading, gaining ground on other major currencies as inflation related fears continue to dominate the sentiment of investors. The US Treasury Secretary, Janet Yellen, admitted on Tuesday that inflation is likely to remain high, as the Biden administration signals its intention to increase the inflation forecast in its budget proposal. In such a scenario, and with two rate hikes of 50bp each expected this summer, the dollar remains strongly supported.

With US inflation figures due to be released on Friday, investors are likely to continue to back the greenback in the runup to the publication of the numbers, as any bets against it could end up proving costly.

Ricardo Evangelista – Senior Analyst, ActivTrades


Disclaimer: opinions are personal to the authors and do not reflect the opinions of LeapRate. This is not a trading advice.

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