Forex, bonds, crude oil – inflation drives the dollar up – economy

Surprisingly high inflation in the United States boosted the dollar on Tuesday. In return, the euro lost almost half a US cent to $ 1.1813. The unexpected sharp rise in consumer prices in the United States has given new impetus to speculation about a rapid turnaround in interest rates by the Fed. This pushed the greenback higher against the major currencies. US Treasuries have gone out of deposits. Ten-year bonds yielded a corresponding higher yield at 1.39 percent.

The inflation rate in the United States has continued to rise from an already high level. The inflation rate climbed 5.4% in June from the same month last year, as reported by the US Department of Labor. Experts expected a slight drop to 4.9%. In May, the rate of price increase was 5.0%. “The specter of inflation is not yet over,” said economist Bastian Hepperle of Bankhaus Lampe. At present, it is mainly energy prices, but also the catch-up effects linked to the koruna, that are causing persistent inflationary pressures. But not all of these influencing factors are permanent and will soon lose their driving force.

The US Federal Reserve (Fed) has also assumed that rising inflation will remain a temporary phenomenon. Because compared to the previous year, there are high rates of price increases due to the economic downturn in 2020. The Fed continues to support the economy with monthly cash injections of $ 120 billion. He also wants to keep his bond purchases until substantial progress is made on price stability and unemployment.

Strong Chinese export figures have supported prices in the crude oil market. A barrel of North Sea Brent cost one percent more at $ 75.92. Meanwhile, the IEA has warned of disagreement among major oil producers over future production quotas from a price war.

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