(London) The dollar moved to the highest level in 16 months against the euro on Tuesday, taking advantage of a message from James Bullard, chairman of the St Louis Fed, who called for an acceleration in the tightening of monetary policy.
The dollar was up 0.22% to $ 1.1344 per euro around 11:25 a.m., after rising to its highest since July 2020 at $ 1.1330. For a month, the single European currency has plummeted 2.5% against the greenback.
Against the Canadian dollar, the greenback was up 0.3037% to 1.2549. One Canadian dollar bought for its part 0.7969 US dollar, down 0.30%.
“I think the (monetary of the US Federal Reserve) committee has a responsibility to be more ‘hawkish’ in its next meetings at its next meetings to face the risk of inflation,” said Mr. Bullard in an interview with Bloomberg.
Economists call supporters of tight monetary policy “hawks”.
“The market is recently counting on faster interest rate hikes” in the United States “after the jump in inflation, and it seems that the Fed is aligning itself with this vision”, judge Fawad Razaqzada, analyst at ThinkMarkets .
Meanwhile, two economic indicators, retail sales and industrial production for October, exceeded market expectations on Monday.
A healthy economy makes it less crucial to maintain a loose monetary policy to support it.
The British pound held up against the greenback (+ 0.03% to 1.3420 dollars) and climbed against the euro (+ 0.25% to 84.53 pence) as the number of jobs increased between September and October in the United Kingdom, opening the door to a tightening of monetary policy according to analysts.
“There were 235,000 more people employed after the end of partial unemployment (end of September) than in February 2020”, notes Kit Juckes, analyst at Societe Generale, who sees “the missing link that will convince the Bank of England to raise its rates in December ”.
British Monetary Institute Governor Andrew Bailey said on Monday he was not ruling out a December rate hike, but was waiting to see how the labor market reacted to the end of government job aid at the end of September .
Finally, on the cryptocurrency side, the volatile bitcoin, which temporarily fell below the $ 60,000 threshold for the first time this month, yielded 5.2% to $ 60,598.