Bank of England Governor Andrew Bailey who He tried to calm the markets by saying that the bank would raise interest rates as much as necessary at its next meeting.
The weakening of the pound sterling It comes after new British finance minister Kwasi Quarting on Friday unveiled the country’s largest package of tax cuts in 50 years, which will likely be funded by Huge increase in debt Even as the country faces a growth slowdown and two deficits. However, how much the pound will appreciate from now is debatable, with Bailey ruling out an emergency rate hike for the time being.
Moreover, the Fed does not appear to be going back on its aggressive anti-inflation stance anytime soon.
Loretta Meester, president of the Federal Reserve Bank of Cleveland, said Monday that the US central bank should raise interest rates and maintain tight policy for some time, adding that if a mistake is to be made, It is better for the Fed to go than to sell.
The dollar index, which measures the currency against a basket of six other major currencies, fell 0.5% to 113,500, not far from Monday’s 114.58 level, its highest since May 2002.
Central Bank Definitions
This week, a series of appearances by members of central banks, with the intervention of the President of the Federal Reserve in Chicago, Charles Evans, is expected during the day. Additionally, a slight rise in consumer confidence is expected from 103.2 to 104.5 in the US Conference Board, while all pointing to a 0.4% drop in durable goods orders in August.
The EUR/USD pair rose 0.5% to the 0.9650 level, after hitting a 20-year low on Monday, as European Central Bank President Christine Lagarde announced that the central bank will continue to raise interest rates at its “next meetings” in an effort to try. To curb high inflation.