USD appears robust. Overview for 01.02.2024

The primary currency pair continues to lose value on Thursday. The current EURUSD exchange rate stands at 1.0807.

The crucial event has already occurred: the US Federal Reserve held its meeting, maintaining the interest rate at 5.5% per annum and providing the market with more insight into the future.

A reduction in the cost of borrowing in March is unlikely due to the apparent high inflation, which poses significant risks to the current monetary policy. At the moment, the interest rate is at its peak. According to the Fed’s chair, Jerome Powell, if the economy develops as expected, a reduction in the interest rate might be deemed appropriate sometime this year.

The Fed still grapples with achieving a sustained reduction in inflation pressure. Otherwise, the regulator will refrain from taking steps whose consequences cannot be predicted.

It appears that stock market expectations were entirely accurate: the focal activity around the interest rate is postponed until May 2024.