Dollar tumbles in early trade

13 Mar 2023 , 09:11 AM

The U.S. dollar declined on Monday as regulators intervened to contain the effects of Silicon Valley Bank’s abrupt failure.

All SVB customers will have access to their deposits starting on Monday, according to multiple steps revealed by the US government early on Monday morning. Authorities added that taxpayer losses would not be incurred in making up for the depositors of New York’s Signature Bank, which was shut down by the state’s financial regulator on Sunday.

The dollar index, which compares the value of the dollar to six other currencies, decreased 0.153% to 104.080. In response to investors moving to safe-haven Asian currencies, the Japanese yen surged 0.34% to 134.52 per dollar, the strongest level in a month.

Sterling recently traded at $1.2085, up 0.47% on the day, while the euro was up 0.44% to $1.069.

The kiwi increased by 0.36% to $0.616 and the Australian dollar increased by 0.79% to $0.663.

Bitcoin recently increased 11.12% to $22,330.00 in cryptocurrency. Ethereum last increased 12.12% to $1,598.90.

Investors conjectured that, in light of the SVB collapse and with Tuesday’s inflation statistics in the spotlight, the Fed would now be reluctant to upset the apple cart by raising interest rates by a whopping 50 basis points this month.

Early trading saw a rise in Fed fund futures, which now suggest only a 17% possibility of a half-point hike, down from over 70% when the SVB news surfaced last week.

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