US Federal Reserve

The Dollar is rising alongside the yield paid on U.S. government treasury bonds, a sure sign that the market did not buy into the Federal Reserve's message delivered at its March policy meeting.

The U.S. Dollar went from boom-to-bust in spectactular fashion late Wednesday after the Federal Reserve (Fed) caught a falling bond market in its arms and in the process burned the fingers of investors whose 'hawkish,' if-not tin-eared wagers had effectively thrown down a gauntlet for American policymakers. 

The Federal Reserve's March policy event is front and centre for foreign exchange markets today and could well determine how the Dollar trades against the Pound and Euro over coming days.

EUR/USD has made a convincing break below the key 1.20 level driven by a surge in U.S. Dollar buying, after Fed Chair Powell failed to directly address a surge in U.S. bond yields.

The U.S. Federal Reserve Chairman Jerome Powell is to sit down with the Wall Street Journal for an interview today and what he says could well dicatate market direction for the next two weeks.

Expectations for higher growth and rising inflation have caused the value of the yield paid on U.S. government bonds to rise rapidly over recent weeks, tightening fiscal conditions not only in the U.S. but around the world.

A subtle shift in guidance by U.S. Federal Reserve Chairman Jerome Powell has done enough to send the Dollar lower against the Pound, Euro and other major currencies once more.

The Dollar faltered and the sell-off in bond markets resumed after Federal Reserve (Fed) Chairman Jerome Powell neglected to indulge misplaced speculation that a tapering of the bank's quantitative easing program is in the pipeline, when appearing before the Senate Banking Committee on Tuesday.  

The Dollar has strengthened over the course of the past 24 hours in the wake of the Federal Reserve policy meeting, although the prime driver of the move appears to be a sharp decline in markets.

Dollar bears took no chances in advance of Wednesday's Federal Reserve (Fed) decision as all major U.S. exchange rates swung higher ahead of an event that will see awkward questions asked of Chairman Jerome Powell and potentially also investors in American stocks and bonds.

U.S. Dollar exchange rates were climbing in a risk-averse market on Friday as investors weighed the prospect of a large U.S. stimulus bill securing safe passage through Congress, a development that some analysts say would likely weigh on the Euro and support the Dollar Index. 

The Dollar has pushed higher against the Euro and other major currencies on Thursday as it extends a week-long recovery, driven primarily by expectations that the Federal Reserve will need to consider withdrawing its stimulus in the future.

The U.S. Dollar cemented its position as the best performing major currency of the week on Wednesday after December inflation figures offered fools' gold to investors, in the process appearing to revive concerns about a possible 2021 tapering of the Federal Reserve's (Fed) quantitative easing programme.

The Dollar softened on Tuesday as stocks and bonds stabilised although the danger is that Federal Reserve (Fed) chatter about a tapering of its quantitative easing programme continues in the coming weeks and further tests investor sentiment as well as the market’s bearish outlook for the greenback.

The Dollar buckled again Thursday after wading knee-deep into losses against all majors in moves that risk making it a global problem currency, sooner or later and once again, as upbeat investor sentiment and Federal Reserve (Fed) policy contribute to rout that has deep-seated economic problems as its foundations. 

The Federal Reserve (Fed) gave a broad but temporary lift to a bruised U.S. Dollar on Wednesday when it made what some economists perceived as an almost half-hearted attempt at aiding the world's largest economy in its battle with a third and largest wave of coronavirus infections to date. 

The Canadian Dollar underperformed on Wednesday but nonetheless, there is a trend emerging that is a problem for the Bank of Canada (BoC) and its economy, a problem which may be solved if policymakers simply do as they often have done by continuing along in the footsteps of the Federal Reserve (Fed). 

The Dollar was down for the count against all major currencies on Tuesday but within recent ranges, although declines could be fueled over the coming sessions by the Federal Reserve, which could be about to target longer U.S. government bond yields with its quantitative easing programme. 

The Dollar squeezed higher Thursday after the Federal Reserve (Fed) failed to settle a debate over its next policy steps and as European currencies came off the boil, but minutes of November's meeting hinted the bank could be about to target long-term bond yields, which may help keep the greenback on a glide path lower.

Contrary to what the Federal Reserve thinks, low US Treasury volatility is dangerously explosive says Althea Spinozzi, Fixed Income Specialist at Saxo Bank.