The course of the euro was linked to its latest profits on Wednesday.
The joint currency was last traded in New York’s trade in $ 1.1663. It output its highest level since October 2021. The dollar cost 0.8622 (0.8615).
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The ceasefire between Israel and Iran had recently caused more risk of risk among investors, which put the dollar under pressure and gave the euro buoyancy in return.
On Wednesday, the focus of Fed President Jerome Powell was once again in focus, who was now commenting in front of the Senate after his previous day’s appearance in the House of Representatives. There he said the central bank still had difficulty assessing the effects of tariffs on consumer prices. He also pointed out the strength of the US economy and the meaning of being careful in times of uncertainty.
Overall, despite the vehement claims by US President Donald Trump, the Powell statements indicate that the Fed is in no hurry with interest rate cuts. Dekabank experts also referred to Powell’s note that the key interest rate could be lowered to the neutral level. This is estimated at 2.5 to 3 percent. The US control interest rate is currently 4.25 to 4.50 percent.
The experts of the Dekabank still see the obstacle to interest in the increased inflation expectations due to higher tariffs. “But if the next inflation data also surprises downwards and the reciprocal tariffs are rather moderate from July 9th, the door would open for previous and clearer interest reductions than expected from the market,” the decabank said. The view of falling interest strains the dollar.
Frankfurt (dpa-Afx)
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