EUR/USD: Powell Sends the Dollar Sharply Lower

The Fed Chair didn’t mince words in his news conference yesterday, spooking investors left and right.

• The EUR/USD pair has been parabolic these past couple of days thanks mostly to Federal Reserve chief Jay Powell. His remarks on hikes and the way forward battered the dollar’s valuation across the board and brought the momentum back in the European currency.
• Today, the euro advanced to an early-Thursday high of $1.0930, after Fed officials announced a 25 bps rate bump on Wednesday. What’s more, Powell said no interest rate cuts are in the Fed’s 2023 playbook. The dollar’s decline was more pronounced in the USD/CHF and the USD/JPY.
• Back to the EUR/USD – the exchange rate hasn’t seen a day in red for the last six trading sessions. During that time, the euro has added nearly 400 pips, or 3.6%, to its value against the greenback as investors are skittish to hold dollars amid looming banking and economic jitters.