PBN Trade Logo

The US dollar is trying to recover after falling to two-month minimums

Today, the US dollar is making attempts to restore its positions in the main currency pairs. The reason for this was a message that the vote on the draft tax reform is likely to take place this week.

In recent days, uncertainty about the future bill on reforming the US fiscal system has put pressure on the US currency. The situation is complicated by the fact that Republicans from the House of Representatives and the Senate presented their own tax reform plans, which differ in many respects. Therefore, the process of approving the final version promises to be long and difficult.

An additional factor that recently contributed to the weakening of the US dollar is the recent comments by Janet Yellen and a number of representatives of the Fed on the prospects for monetary policy. Officials worry that in case of too rapid a rise in the interest rate, inflation may gain a foothold below the target level of 2%.

Nevertheless, most members of the Fed are confident of the need for the next act of monetary restriction in December. Delay can cause overheating of the labor market in conditions of the country's approach to absolute employment.

Today, the performance of FOMC members William Dudley and Jerome Powell is expected. Officials can give clues as to the future plans of the Fed, although practically no one doubts that the federal funds rate will be raised at the next meeting, which will be held on December 12-13.