US Dollar Bounces as Traders Continue to Anticipate Fed Hike

The US dollar rose on Monday as expectations of March interest rate hike from the Federal Reserve allowed the currency to bounce after Friday’s profit-taking sell-off.

The Fed will conduct its two-day policy meeting next week and will announce the decision on March 15. Currently, the probability of March hike shown by CME FedWatch is at 86.4%, up from 79.7% a day before.

Additionally, traders wait for February US nonfarm payrolls released this Friday. Analysts predicted gain by 185,000, which is solid by itself but lower than the previous month’s 227,000.

Released on Monday, a report showed decent growth of US factory orders by 1.2%, which was close to market expectations and the previous month’s rate of increase.

EUR/USD dropped from 1.0607 to 1.0579 as of 22:42 GMT today after rising to the high of 1.0639 intraday. GBP/USD declined from 1.2283 to 1.2237. USD/CHF rallied from 1.0091 to 1.0116.

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