The USD is rising against the other major currencies

23 may 2023

FX

The US dollar is rising against the other major currencies as the European session gets underway. The greenback is experiencing greater demand as a drop in global risk appetite increases flows into perceived safe-havens. A lack of agreement between Democrats and Republicans on raising the debt ceiling is increasing anxiety levels amongst investors, who are left fearing the unknown consequences of a US government default. It is still widely assumed that there will be a last-minute agreement, but the closer the deadline of early June gets, the higher the volatility we should expect in financial markets. Against this background, the dollar is likely to remain supported in the runup to the deadline, in a dynamic supported by the words of senior Fed officials, who recently highlighted the stickiness of inflation and defended further interest rate hikes this year.

Ricardo Evangelista, Senior Analyst, ActivTrades