🔺 What to do when markets are at an all-time high? Find smart bargains, like these.See Undervalued Shares

Dollar Follows Bond Yields Lower After Powell Says No Liftoff Ahead

Published 17/03/2021, 19:30
© Reuters.
DX
-
US10YT=X
-

By Yasin Ebrahim

Investing.com – The dollar slumped on Wednesday, paced by a decline in U.S. bond yields after the Federal Reserve kept rates on hold and projected no hikes through 2023.

The U.S. dollar index, which measures the greenback against a trade-weighted basket of six major currencies, fell by 0.43% to 91.48 as the U.S. 10-year Treasury yield retreated from 13-month highs.

The Federal Open Market Committee left its benchmark rate unchanged in the range of 0% to 0.25% and said it would continue its $120 billion monthly bond purchases.

"Following a moderation in the pace of the recovery, indicators of economic activity and employment have turned up recently, although the sectors most adversely affected by the pandemic remain weak. Inflation continues to run below 2 percent," the Fed said in a statement.

The Fed upped its growth targets for the years ahead, forecasting the economy to grow by 6.5% in 2021, and 3.3% in 2022, but it kept its interest-rate outlook unchanged for no hike through 2023. 

Looking ahead, Fed chairman Jerome Powell suggested that the tapering was still a ways off as the economy has yet to achieve substantial economic growth. An eventual taper of bond purchases will be signaled well in advanced, the fed chief added.

"We will give a signal that we're on a path to possibly achieve substantial growth to consider tapering. I think what we've learned from the experience of these last dozen years, is to communicate very carefully, very clearly, [and] well in advance," Powell said.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.