Forex - ECB’s Weber reopens speculation about interest rate increase despite FOMC suggestion for a Federal Reserve rate hike - Forex Forum

The Dollar tumbled from six-month peaks against the Euro on Wednesday, as comments by European Central Bank official reopened speculation about an interest rate increase in the euro zone to fight persistent inflation pressure.

ECB’s Weber told News agencies that any talk about lower interest rates in the euro zone was premature. He also gave the impression that if the euro zone economy improves toward the end of the year, there might even be scope for tightening.

Economists expect the Federal Reserve to raise rates, although minutes of FOMC last meeting suggested that weak financial conditions and slow growth could prevent such a move. But the Dollar might be supported by a deteriorating global economy even as the Fed
seems likely to keep rates on hold in the coming months.

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