The euro thus interrupted its recent upward trend. Above all, the expectation of a foreseeable end to the interest rate hikes in the USA had weighed on the dollar recently. According to a majority of financial market experts, the US Federal Reserve should only raise the key interest rate by 0.25 percentage points and then take an interest rate pause. Recently, the high inflation had weakened. Falling import prices and a surprisingly significant drop in retail sales confirmed the picture on Friday.
However, the dollar was boosted in the afternoon (CEST) by statements by Fed Director Christopher Waller. He called for a further tightening of the monetary policy, as inflation is still very high and the labor market is very robust. How much the Fed has to raise interest rates depends on further economic data and the conditions on the credit markets. Other members of the Fed had recently spoken more cautiously than Waller. Rising interest rates tend to support a currency.
NEW YORK (dpa-AFX)