Bernanke testimony weighs on USD

During his semi-annual conversation with Congress, Ben Bernanke, Chairman of America’s Federal Reserve Bank suggested the US economy may soon begin to slow, due in part to the Fed’s monetary tightening. Thus, hinted Bernanke, the Fed will likely pause after hiking interest rates in May, and take some time to evaluate the state of the economy as well as the full effect of its monetary policy. This sent a ripple through futures and forex markets, which had previously expected the Fed to raise interest rates at least twice more before stopping. The Financial Times reports:

“Bernanke’s comments suggest that the market has got a little ahead of itself…, and as the market scales back such thoughts the dollar will likely come under further pressure.”

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