The US dollar rose against all major currencies this week, reversing some of its fall over the past month or so. Much of this strength came late in the week as equity markets came under renewed pressure in the aftermath of the ECB’s hawkish message at its policy meeting yesterday. In particular, the lack of details on a “spread-fighting tool” pushed periphery spreads higher. And today, the higher-than-expected US CPI data added to evidence that the Fed will almost certainly raise rates by 50bp next week and will need to maintain its hawkish policy stance to bring inflation down.
BoE Preview Drop-In (14th June, 10:00 ET/15:00 BST): Just ahead of the June MPC decision, we’ll explain in this 20-minute briefing why we’re even more convinced that UK rates will peak at an above-consensus 3% next year. Register now.
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