The Fed minutes last night revealed that “several” Fed members wanted to raise interest rates as early as June. Whether that view still holds in the wake of last week’s employment report is another matter, but the net effect was to give a modest bid to the dollar in the wake of the release.
Interestingly, in looking at the factors that would make them “reasonably confident” that inflation would turn higher, a levelling of the exchange rate was one factor (together with further labour market improvement and stabilisation of energy prices).
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