XE Market Analysis: Europe – Feb 25, 2021

The DXY dollar index has sank to new six-week lows under 89.95 following Fed chair Powell’s successful attempt to convince markets that the punch bowel of monetary stimulus isn’t going to be taken away anytime soon, even in the face of rising inflation. While admitting that asset prices are “somewhat elevated” and that there would be a brief surge in price pressures as the economy opens up from Covid restrictions, he argued that the Fed should be able to anchor expectations to prevent a higher inflationary process from taking root.