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U.S Under Pressure To Raise Dollar Exchange Rates Amid Rising Inflation

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The greenback dropped significantly against its rivals on Tuesday as currency analysts anticipated more selling pressure on the U.S dollar despite concerns that the U.S Federal Reserve might raise rates sooner than expected.

At the time of writing this report, the U.S. dollar index, which tracks the U.S dollar strength against major currencies dropped by 0.12% to trade at 90.945 points.

Currency traders and analyst anticipate the second coming of dollar strength, might not last long with inflation picking up at record levels coupled with an unlikely aggressive approach towards tightening monetary liquidity from the U.S Apex Bank.


The U.S. Dollar Index tracks the American dollar against a basket of other major currencies (like the Japanese yen, British pound sterling, Swedish Krona, and Euro). Individuals hoping to meet foreign exchange payment obligations via dollar transactions to countries like Europe, and Japan, would need to pay more dollars in meeting such obligations.

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Stephen Innes, Chief Global Market Strategist at Axi in a note to Nairametrics gave valuable insights on the macros weighing on the dollar in the near term.

“It looks very much like a textbook case of US dollar weakness as the pieces are slowly falling into place for a dollar selling trend to resume.


“A deteriorating US trade deficit, a retracement in Fed. pricing, a significant upturn in European vaccination rates and upcoming growth acceleration support the view.”

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The information contained in this post is for general information purposes only. Opinion articles, comments are solely the responsibility of the author and does not necessarily reflect the views of BlazeNewz while we endeavour to keep the information accurate with objectivity as we adhere to global practice of journalism. Read our full Disclaimer.

Hammed Tajudeen is the editor in-chief of Blaze News, holds Higher National Diploma(HND) in Mass Communication, graduated from Osun State Polytechnic, Iree.

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