Interest Rate Hike Causes Dollar to Rise
The federal reserve has indicated it will likely embark on a steeper path of interest rate hikes over 2017, the dollar rate has now spiked against its other peers today even as most Asian markets have stumbled.
The naira is one of the major currencies that has been hit by this even as the dollar continues its upward spike against the naira.
This led to most investors rushing over the prospect of tighter borrowing costs as the Federal Reserve positions itself due to the fact that if Donald Trump keeps his words to ramp up infrastructure spending and slash taxes then there will be a jump in inflation.
At present, the dollar is at its highest in about 10 months and this is due to this interest rate hike announcement even as the dollar has knocked other currencies with those of emerging market and nations being the most hit.
Due to the dollar being the key driver of global growth, a lot of other speculators and financial powers were unable to comfort Asian traders who are worried that a flood of cash out of their own economies would affect them since people would source better deals in the United States.