EUR skyrocketed. Overview for 21.03.2024

The main currency pair continues its rise on Thursday, following the uptrend from the previous day. The current EURUSD exchange rate stands at 1.0933.

At its March meeting, the US Federal Reserve System left the interest rate unchanged at 5.5% per annum. At the same time, the Fed did not rule out reducing the rate by 75 basis points this year in three steps. The central bank continues to reduce the size of its balance sheet, and funds from matured bonds are no longer reinvested. Everything is going according to plan.

The Fed interest rate is currently at its highest level in 23 years. It has remained unchanged for the fifth consecutive meeting.

The tone of the Fed’s comments appeared quite confident, which pleased capital markets and boosted risk appetite. However, the Fed has not yet provided specific timelines.

Estimates for US GDP, inflation, and the employment market were positive. The regulator is confident that the country’s economy increased by 2.1% q/q in Q1 2024. This is a positive result. The employment sector appears sturdy due to newly created jobs. Inflation remains stable, but it seems high compared to the 2% target.

Overall, the Fed has done everything that was expected of it. Investors received more clarity, leading to action against the USD.