Title: Dollar Up Despite Concerns Over Economic Recession

Jun 27, 2022 11:38PM ET

By: AnalysisWatch

The dollar rose Tuesday morning in Asia despite concerns about the economic recession. Investors are awaiting a speech by European Central Bank (ECB) President Christine Lagarde.

The U.S. Dollar Index, which tracks the greenback against a basket of other currencies, was up 0.02% at 103.96 by 11:21 PM ET.

The USD/JPY pair declined 0.13% to 135.26.

The pair AUD/USD decreased 0.04% to 0.6920, and the pair NZD/USD declined 0.12% to 0.6292.

The USD/CNY pair rose 0.09% to 6.6978, while the GBP/USD pair gained 0.07% to 1.2272.

Governor Yi Gang said the central bank will maintain its policy to support the Chinese economy.

Investors are watching for signs of weakness in recent economic data that would potentially weaken rate hikes. But they are also concerned that this could be a sign of the start of difficult stagflation.

"Stay invested in the dollar until the uncertainty has eased a bit," Kit Juckes, a strategist at Societe Generale, told Reuters.

"The dollar will fall, but probably not until the global economy is on a more sustainable growth path... markets are forward-looking, but all we can see today is danger."

On the other hand, German inflation data is due on Wednesday and French data on Thursday.

"These inflation data will have a significant impact on the ECB's monetary policy guidance, particularly on the course of its rate hike cycle, which is expected to start in July," CMC analyst Kelvin Wong told Reuters.

At the ECB Forum in Sintra, Portugal, on Wednesday, U.S. Federal Reserve Chairman Jerome Powell, Bank of England Governor Andrew Bailey and Cleveland Fed President Loretta Mester will speak at the ECB Forum in Sintra, Portugal.