The dollar closed a Wednesday session marked by high price instability before knowing the monetary policy decision of the United States Federal Reserve, which finally adjusted to market expectations with a rise of 75 basis points (bp) .
According to Bloomberg, the price of the dollar in Chile closed with a minimum rise of $0.85 to $935.85 after a series of ups and downs that led him to reach a peak of $947.15 around noon, as investors anxiously awaited the Fed’s statement.
XTB Latam market strategist Benjamín Castillo pointed to two reasons why the exchange rate neutralized his gains at the close.
“The first is that most of the foreign exchange market was closed when the Fed rate hike was announced. After 2 in the afternoon all the banks close and liquidity drops a lot, so the reaction was almost nil, since the decision was made after 3 in the afternoon,” he said.
And secondly, he stressed that the published data was in line with what was expected, “therefore, not having so many surprises, it did not change the panorama.”
The dollar index rose 0.41% to 110.66 points after reacting to the news by extending its gains to new 20-year highs, but then cutting its gains during Fed Chairman Jerome Powell’s press conference. Powell’s statements were still ongoing at the end of this note.
For its part, Copper futures on the New York Comex exchange fell 1.21% to US $ 3.46 a poundafter suddenly falling after the announcement and recovering the levels at which they were trading.
The daily price of the exchange rate was pushed up by geopolitical tensions after Russia’s announcement of the partial mobilization of reservists to support its invasion of Ukraine, which increased global demand for dollars and caused copper to fall.
The red metal was also pressured lower by higher inventories. Copper inventories on the London Metal Exchange rose this Wednesday to 118,000 metric tons after a daily rise of 10.13%, the highest since last June.