Dollar Surges as ECB Raises Interest Rates
The dollar rose against major currencies on Thursday after the European Central Bank raised interest rates by 25 basis points. The move was widely expected, and the euro dropped immediately following the decision.
The euro fell to $1.1612 from $1.1627 as markets worried about the economic impact of future rate hikes aimed at taming inflation.
Eugene Epstein, head of structured products for North America at Moneycorp, said the dollar's gains were driven by U.S. producer prices, which matched market forecasts and reinforced expectations of a Federal Reserve rate hike next week.
The dollar index rose 0.28% to 99.06, snapping three straight sessions of losses. Oil prices also surged after Iran-aligned Houthis seized Yemen's port of Mocha, heightening concerns about disruptions to Red Sea shipping.