The dollar slumped on Thursday against the pound and, to a lesser extent, against the euro, following the announcement of a sharp slowdown in US inflation in October. At around 2:15 p.m. GMT (3:15 p.m. in Paris), the greenback was down 2.31% at $1.1627 per pound, down 1.94% at 143.67 yen per dollar and down 1. 27% to $1.0140 per euro according to investors. they believe that the fight against inflation by the US Federal Reserve (Fed) can be eased.
Inflation slowed in the United States in October, to 7.7% year-on-year from 8.2% in September, falling to its lowest level since January 2022. In one month, the increase in consumer prices is stable , at +0.4%, the same as in September.
Data still insufficient to change Fed policy
“Investors were waiting for the consumer price index (CPI) in the hope of finding an indication that the end was near, and they found it,” adds Stephen Innes, analyst at SPI AM. But “a single data is not enough to swing the Federal Reserve,” warns Neil Wilson, an analyst at Markets.com. The Fed raised its rates by 0.75 points in early November, signaling that “further increases will be appropriate.”
However, the dollar, which initially benefited from this desire to tighten monetary policy, has been caught in a bout of weakness in recent sessions, with investors betting that the monetary institute will not dare to apply its program if the economy slows too much. However, high interest rates make investing in dollars more profitable for investors.
On the crypto side, bitcoin rallied 10.8% to $17,432, after starting the session at its lowest level since November 2020 at $15,574. The crash of the FTX exchange, which was expected to be bailed out by rival Binance before backing down, has caused Bitcoin to lose almost a fifth of its value since Sunday.
Source: BFM TV
