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Peter Davis

An writer at FOMOdrive

  • Jun 30, 2023
  • 2 min read

The US dollar rose against the backdrop of the ECB forum in Sintra

100 us dollar bills

On Wednesday, the dollar increased in value against the backdrop of the European Central Bank's forum in Portugal.

At the city of Sintra, the heads of the most prominent central banks around the globe convened to speak.

The dollar index reached a four-day peak above 103.

Leaders of the world's most prominent central banks have convened in Sintra, Portugal, for the European Central Bank's yearly forum.

At Wednesday's panel discussion, Jerome Powell (Fed chief), Christine Lagarde (ECB chief), Andrew Bailey (Bank of England governor) and Kazuo Ueda (Bank of Japan governor) spoke.

Fed Chairman Jerome Powell stated that a large majority favored two more rate hikes within the scatter chart, and he would not rule out the possibility of new restrictive measures at subsequent meetings.

He stated that there needs to be more weakening in the labor market. Although the probability of an economic recession is high, it is not the most probable outcome. The current indicators suggest that the US economy will experience a "soft landing".

Powell stated that the Federal Reserve is keeping a close eye on the commercial real estate market. He also noted that he does not anticipate a return to 2% inflation in either 2021 or 2022, but that they are making progress in that direction.

Christine Lagarde, the head of the European Central Bank (ECB), stated that it is unlikely that the ECB will be able to finish the process of tightening monetary policy in the foreseeable future.

She stated that the ECB has not observed enough concrete proof of lower inflation. If the current situation persists, it is probable that the central bank will increase rates once more in July.

Bank of England Governor Andrew Bailey declared that the data indicated a strong resistance to inflation. The Central Bank will take all necessary steps to ensure that inflation reaches its desired level.

Kazuo Ueda, the head of the Bank of Japan, stated that although there are indications of an increase in inflation expectations, they do not reach the desired inflation rate.

He noted that there is still a distance to travel in order to sustainably achieve 2% inflation, along with adequate wage growth.

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