Dollar Surges as Brent Oil Tops $100 Amid Global Supply Concerns
The US dollar rose to a one-month high on Thursday as Brent crude oil prices topped $100 per barrel for the first time since late May.
Investors sought safe-haven assets like the greenback amid concerns over global oil supplies and inflation fears. The dollar has gained in recent days as traders reassess the likelihood of interest rate hikes by the Federal Reserve, given its better economic position than Europe and Japan to withstand higher energy costs.
The EUR/USD pair fell 0.3% to $1.1374 after the European Central Bank (ECB) kept interest rates unchanged at 2.25%, 2.40%, and 2.65%. ECB President Christine Lagarde said the decision was unanimous, but noted that some governors had considered a rate hike.
The central bank will follow a data-dependent approach to setting monetary policy, according to its statement. Mark Wall, chief European economist at Deutsche Bank, predicted one more interest rate hike to 2.50% would be needed to curb inflation risks, depending on growth as much as inflation.