The U.S. dollar slipped lower in early European trade Monday as traders reassessed the likelihood of another rate hike by the Federal Reserve later this month given the ongoing U.S. banking crisis.<\/p>\n
At 04:10 ET (08:10 GMT), the\u00a0Dollar Index<\/a><\/span>, which tracks the greenback against a basket of six other currencies, traded 0.6% lower at 103.528, trading near a one-month low.<\/p>\n The U.S. authorities decided to step in over the weekend and cover all depositors at Silicon Valley Bank\u00a0(NASDAQ:SIVB<\/a><\/span>), which had to cease trading last week, as well as depositors at SignatureBank, which was wrapped up over the weekend.<\/p>\n Both the U.S. Treasury and Federal Reserve were keen to make sure the second- and third-largest failures in U.S. banking history wouldn\u2019t have wider repercussions, announcing emergency funding measures for the sector.<\/p>\n The news also raised expectations that the\u00a0Fed<\/a><\/span>\u00a0would hold back from increasing interest rates by an outsized 50 basis points next week, given the strain on the U.S. banking system.<\/p>\n Influential investment bank Goldman Sachs said on Sunday that they no longer expect the U.S. central bank to deliver a rate hike at its meeting on March 22, having previously predicted a 25-basis-point increase.<\/p>\n \u201cPressure on the U.S. banking system is questioning whether the Fed can push ahead with such an aggressive tightening cycle,\u201d said analysts at ING, in a note. \u201cOne would normally think that a sell-off in equities is dollar bullish, perhaps not, however, if the epicentre for current stress is the U.S. banking system.\u201d<\/p>\n Elsewhere,\u00a0EUR\/USD<\/a><\/span>\u00a0rose 0.8% to 1.0730, hovering near a one-month high with the single currency benefiting from the dollar selloff.<\/p>\n Additionally, the\u00a0European Central Bank<\/a><\/span>\u00a0meets later this week, and is widely expected to raise interest rates by 50 basis points as inflation data last week pointed to underlying price pressure remaining elevated.<\/p>\n GBP\/USD<\/a><\/span>\u00a0rose 0.6% to 1.2105, helped by the news HSBC (LON:HSBA<\/a><\/span>) has agreed with the Bank of England to buy the U.K. operations of\u00a0Silicon Valley Bank<\/a><\/span>, helping to make sure there is no contagion from the collapse of the U.S. lender late last week.<\/p>\n The U.K. government also presents the\u00a0Budget<\/a><\/span>\u00a0on Wednesday, and Chancellor Jeremy Hunt is expected to prioritize keeping public finances steady given his predecessor\u2019s difficulties.<\/p>\n USD\/JPY<\/a><\/span>\u00a0fell 0.2% to 134.60, not far off a one-month high, the\u00a0AUD\/USD<\/a><\/span>\u00a0rose 1.4% to 0.6670, on track for its biggest one-day percentage jump since Jan. 6, and\u00a0USD\/CNY<\/a><\/span>\u00a0edged lower to 6.9033.<\/p>\n Source: https:\/\/www.investing.com\/news\/forex-news\/dollar-weakens-as-banking-turmoil-could-stay-feds-hand-3028541<\/p>\n","protected":false},"excerpt":{"rendered":" The U.S. dollar slipped lower in early European trade Monday as traders reassessed the likelihood of another rate hike by the Federal Reserve later this month given the ongoing U.S. banking crisis. At 04:10 ET (08:10 GMT), the\u00a0Dollar Index, which tracks the greenback against a basket of six other currencies, traded 0.6% lower at 103.528, […]<\/p>\n","protected":false},"author":1,"featured_media":374,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3],"tags":[],"class_list":["post-373","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news","wpautop"],"translation":{"provider":"WPGlobus","version":"2.10.10","language":"es","enabled_languages":["en","nl","es","sv","fr"],"languages":{"en":{"title":true,"content":true,"excerpt":false},"nl":{"title":false,"content":false,"excerpt":false},"es":{"title":false,"content":false,"excerpt":false},"sv":{"title":false,"content":false,"excerpt":false},"fr":{"title":false,"content":false,"excerpt":false}}},"yoast_head":"\r\n