Forecast: US-dollar rate not expected to sharply rise in 2017

Forecast: US-dollar rate not expected to sharply rise in 2017 Strengthening of dollar and euro parity seems delayed for a year
Analytics
February 6, 2017 17:18
Forecast: US-dollar rate not expected to sharply rise in 2017

Baku. 6 February. REPORT.AZ/ Sharp appreciation of US-dollar not expected despite the probabilities of increasing Federal Reserve System (Fed) by three times in 2017. 

Analytical Group of Report informs, Fed's decision to increase interest rate can take place in March. Thus, decisions made by the new president of the United States has already begun to bear fruit. The world's leading companies started to relocate their production in US, US largest banks to implement tax discounts and therefore capital began to return to the United States. As a result, the first indicator of the labor market announced during the presidency of Donald Trump, the labor market exceeded expectations by 50% and reached 227,000 people.

Before the meeting of Fed on March 14-15, the number of new jobs will increase in US, inflation to accelerate.This, in turn, will force to raise interest rates. However, Tramp administration repeatedly noted that they are against sharp strengthening of the dollar. Therefore, despite the decision to increase interest rates, main currency pairs - EUR/USD will decline slightly to the level of 1.04 USD/EUR. The upper limit of the exchange rate may raise to the level of 1.10 USD/EUR. 

The strengthening of the dollar and euro parity seems delayed for a year.

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