The U.S. dollar index remained at its highest level in 20 years in morning trading in Asia on the 14th.
As of 10:12 a.m. GMT+8, the dollar index (currency value of the six major countries against the dollar) recorded 105.20, 0.11% higher. The dollar index continued to rise at its highest level in 20 years in major New York time zone trading last night.
One euro is the lowest in a month, moving around $1.2145. The Australian dollar and the New Zealand dollar are also trading at their lowest level in a month against the U.S. dollar. The British pound is moving at a two-year low of $1.2109.
As of 11:17 a.m., the dollar/yen exchange rate (opposite to the yen’s value) fell 0.02% to 134.35 yen. The Japanese government’s verbal intervention lowered the exchange rate below 135 yen, but the yen’s value still remained at its lowest level in 24 years.
The dollar strengthened as the U.S. central bank’s Federal Reserve (Fed) is expected to set the base rate increase at 0.75 percentage points (p), which is larger than before. But almost all assets fell except for the dollar. Last night, the yield on government bonds (opposite to price) jumped, the New York stock market plunged more than 4%, and Bitcoin plunged 15%.
Kit Junks, strategist at Societe Generale, pointed out to Reuters that the market had excessively invested (money) in the idea that inflation had reached its peak. “The Fed has a policy challenge that it has no idea how much monetary tightening is necessary,” he said. “The Fed will notice after doing so that it has been too tight.”
