The dollar recouped some losses against major currencies on Thursday, driven by rising oil prices and bond yields. Meanwhile, the euro slipped following the European Central Bank’s anticipated interest rate hike, the second this year, aimed at curbing inflation amid the Iran war.
Declining to $1.1612 against the dollar, the euro’s drop worried markets about the economic impacts of future rate hikes, with the ECB focusing on taming inflation. U.S. producer prices bolstered the dollar’s gains, reinforcing expectations of a Federal Reserve rate hike, according to Eugene Epstein of Moneycorp.
The dollar also gained from a spike in oil prices after geopolitical tensions in Yemen and threats to Red Sea shipping. Analysts at Bank of America forecasted a potential relief rally pending CPI outcomes, aligning with stronger oil prices and a strategic U.S. Treasury response.
(With inputs from agencies.)
