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© Reuters
By Peter Nurse
Investing.com – The US dollar gains positions at the start of trading in Europe on Wednesday, stabilizing after losses on uncertainty surrounding the US midterm elections and ahead of key data on the inflation this week.
At 08:50 AM ET, the , which tracks this coin against a basket of six other majors, is up 0.1% at 109.625, after losing around 1% so far. of week.
The results of the US mid-term elections remain uncertain, and the Republicans appear poised to gain control of the House of Representatives. However, the Senate race seems too close at the moment, and many of the most competitive issues remain undecided.
“A Republican victory in one of the US chambers and the resulting deadlock could challenge further fiscal stimulus, and raise the prospect of clashes over government funding terms and the US debt ceiling,” HSBC analysts explain, in a note.
“But these are questions for 2023. The most immediate concern in the markets is whether any of the election results are actively contested, and whether the results [presidenciales] of 2024 will be accepted”.
Also on the horizon is the crucial , which is expected to show a drop in the annual CPI figure to 8.0% in October from 8.2% in the previous month, while everything points to the figure , which excludes volatile food and energy prices, will decline from 6.6% to 6.5% annually.
The dollar has been weighed down of late by expectations that it will exit its aggressive rate hike cycle soon, possibly as early as December.
However, an inflationary surprise to the upside could change that idea, adding to the momentum of the US currency.
The pair is down 0.1% to the 1.0068 level as the European Central Bank is due to hold an extraordinary meeting later in the day.
Policy makers at the ECB have made it clear that further rate hikes are on the way, after the central bank raised interest rates by 75 basis points late last month, despite eurozone growth slowing. has suffered enough.
“I will do everything in my power to ensure that we, the Governing Council of the ECB, do not give up prematurely and continue to push for the normalization of monetary policy, even if our measures hold back economic development,” he said on Tuesday. Bundesbank President Joachim Nagel.
The pair falls to the level of 1.1532, the rises 0.1% to 145.75, the yen falling to its lowest level since 1992, as the Japanese authorities decided to keep their monetary policy accommodative, while that the , very sensitive to risk, falls 0.1% to 0.6495.
The pair advances to the 7.2508 level as China struggles to contain its worst COVID-19 outbreak since May.
The pair rose 0.4% to 4.6692 ahead of Poland’s central bank’s monetary policy meeting on Wednesday, amid uncertainty over whether the country’s policy makers will resume rate hikes after last month’s pause.
Economists surveyed by Bloomberg are divided on the matter, with 17 of 32 forecasts calling for a hike of some size, while 15 say rates will remain unchanged.
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