The U.S. Dollar Index, which tracks the value of the U.S. Dollar against a basket of six foreign currencies, rose to a four-month high after the U.S. Federal Reserve’s meeting minutes on Wednesday. The USD Index rose 0.6% in trading Wednesday to hit 94.89, while the Euro strengthened 1.5% to $1.1757 and the Pound sterling gained 0.7% to $1.5012.

The dollar is stronger today than its been for over a year, with the USD/ CNY up as much as 2% against the greenback in morning trade. The central bank of China will likely cut interest rates for the sixth time in 6 months this week, after the Chinese economy slowed more quickly than expected in the first half of the year. The greenback has now gained over 30% against the yuan in the month of July, with the 30-day moving average crossing 0.8500 for the first time since January.

In the latest round of trading, U.S. Dollar Index gains are getting stronger as the U.S. Dollar gets stronger. The USD is a currency used around the world, and is traded in the forex market. The U.S. has the largest economy in the world, and the U.S. Dollar is one of the most widely traded currencies in the world.. Read more about fed announcement today and let us know what you think.

Stronger USD Emerges Ahead of Fed Decision


  • Support from the Federal Reserve is expected to remain unchanged.
  • On cautious sentiment, the euro and the pound also fell.
  • As China stocks recover some ground, Wall Street remains flat.

Through the middle of this week, the Dollar is the only currency in the forex market that has shown any signs of strength. This comes amid considerable trepidation as the public awaits the Fed’s policy decision at the conclusion of their two-day meeting. As a result, both the pound and the euro are trading below their starting levels, despite the fact that the Fed policy is unlikely to alter much. On Wall Street, the market stayed flat, with investors waiting to see what happens, but China equities, which have been hammered this week, seem to be recovering some ground. 

The Fed’s blanket of support is expected to remain in place.

Though there has been some concern among forex traders as the market awaits the Fed’s policy announcement, they are generally anticipated to avoid any major adjustments or contentious choices. Despite the fact that inflation is at an all-time high, it is unlikely that any of the support measures put in place will be rolled back. 

The same seems to be true with tapering, which, despite the fact that many experts have said that it is necessary, the prevailing assumption is that Jerome Powell and others would proceed with their policy statement without making any explicit promise to decrease bond purchasing. At least for the time being, and at least immediately, this is the case. However, many people realize that the time for action is rapidly approaching. 

Dollar Weighs Down Major Currencies

Forex brokers have noted since the Fed meeting kicked off, that the Dollar began an uptick with traders remaining guarded and waiting for the outcome of the day. This is often the case with such decisions, particularly now during a continually unpredictable pandemic period. With COVID-19 cases still proving troublesome in many areas, there is also a re-emerging fear of a move back toward restriction and lockdown in some of the worst-hit areas. 

The Euro fell below 1.18, while the Pound lost some of its recent gains and fell below 1.39. The GBP is showing signs of life, as COVID cases continue to fall week after week, despite the fact that virtually all restrictions have been lifted. This optimism has faded, at least for the time being, as the Fed decision’s underlying caution comes into focus. 

China’s Stocks Fight Back

On Wall Street, it’s been a mostly positive week. Traders seeking for the next edge will be watching the Fed decision and its possible effect today as markets start flat. Meanwhile, battered Chinese equities have recovered some of their losses. 

As Beijing’s evaluation of big tech continues, they are still nowhere near where they began the week or month. However, companies like Pinduoduo and Didi Global have made significant gains today.

The US dollar is taking a beating in the markets amid concerns of a trade war with China and questions about the strength of the US economy. Soaring Treasury yields and the Federal Reserve’s decision on interest rates could provide a boost to the greenback, analysts say.. Read more about u.s. bond yields news and let us know what you think.

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