The global dollar is rising to a two-year high

The dollar rose to its highest level in two years on Jan. 14 as strong economic data prompted investors to reduce bets on Federal Reserve rate cuts while potential tariffs of the US remains committed. Reuters writes about it.

The dollar index, which measures the US currency against six other currencies, rose 0.20% to 109.58, not far from the 26-month high of 110.17 it hit on Monday. In October 2022, it reached 114.78, the highest since 2002.

After Friday’s jobs report added support for the US central bank’s cautious stance, investors will keep an eye on US inflation numbers, with producer prices (PPI) due later on Tuesday and the consumer prices (CPI) will be paid on Wednesday.

Traders expect the Fed to ease monetary policy by 28 basis points this year, lower than the 50 basis points the Fed forecast in December.

Yields on 10-year US Treasury notes hit a 14-month high of 4.805% on Monday before retreating on Tuesday.

With President-elect Donald Trump returning to the White House next week, much of the focus will be on his policies, which analysts expect will boost growth and pressure prices.

The threat of tariffs, along with a lower likelihood of a Fed rate cut, reportedly raised Treasury yields and supported the US dollar.

The euro rose 0.12% to $1.0257. It hit $1.0177 on Monday, its lowest level since November 2022.

Overall, the euro fell more than 6% in 2024 as investors worried about tariff threats and monetary policy differences between the Federal Reserve and the European Central Bank.

Let us remind you that the National Bank increased the dollar exchange rate, although in the interbank market the American currency fell in price by 10 kopecks – to 42.27-42.30 UAH/dollar.