With the Fed's rate hike in line with market expectations, is the U.S. dollar entering a correction phase?
17.03.2022
- Bank of England Announces Policy Rate and Statement
- U.S. Initial Jobless Claims
U.S. currencies traded weakly yesterday, with the euro rising approximately 100 pips against the dollar from 1.094 to 1.105.Although the U.S. dollar is rising against the yen, it is trading weakly against other currencies, and the "flight to safety" buying of the U.S. dollar is beginning to fade. With geopolitical risks such as the situation in Ukraine still unresolved, market movements are increasingly reflecting acceptance of the current situation, so we should remain vigilant for a correction in the U.S. dollar.
Among European currencies, the euro has been surging, with the EUR/JPY pair rising by approximately 189 pips from 129.50 to 131.46. Technically, the EUR/JPY pair continues to move within a range along the 10-period moving average on the 4-hour chart. If this upward trend persists, it could reach this year’s high of around 133.15; we will be watching price movements closely as we head into U.S. trading hours.
Today’s schedule includes remarks by ECB President Lagarde at 18:30 CET, the Eurozone Consumer Price Index at 19:00, the Turkish Central Bank’s (TCMB) policy rate and statement at 20:00, and the UKBank of England (BOE) policy rate and statement, and at 21:30 U.S. time, the Canadian House Price Index, U.S. Initial Jobless Claims, U.S. Housing Starts, and the U.S. Philadelphia Fed Business Outlook Index are scheduled for release, followed by U.S. Industrial Production and U.S. Capacity Utilization at 22:15, and U.S. Weekly Natural Gas Inventories at 23:30.We will carefully assess whether the US dollar will enter a correction phase heading into the weekend.
Author: Keisuke Sakurai
