NEW YORK: The dollar advanced against other major currencies Tuesday after a US Federal Reserve official expressed support for lifting interest rates at the central bank’s September policy meeting.
Federal Reserve Bank of Atlanta President Dennis Lockhart told The Wall Street Journal that he supports lifting rates in September barring an unexpected stumble in the economy.
“It will take a significant deterioration in the economic picture for me to be disinclined to move ahead,” Lockhart told the newspaper.
Nomura analyst Jens Nordvig said Lockhart’s comments moved the dollar “meaningfully” higher in afternoon trade.
However, Nordvig said key US economic data, including the July jobs and retail sales reports, will be key in determining the dollar’s course in the coming weeks.
“If the data is strong and/or Fed comments are constructive over the next few weeks, we will price September” as a likely start to lifting rates, Nordvig said in a client note.
“If, on the other hand, the data disappoints, September can be priced out almost entirely, and we may even have doubts about liftoff in 2015 altogether.”