Dollar Surges Higher Against Major Rivals

(RTTNews) - The U.S. dollar firmed against its major counterparts on Wednesday as falling risk sentiment pushed up the demand for the safe-haven currency.

Speaking at the European Central Bank's forum in Sintra, Federal Reserve Chair Jerome Powell warned of an economic downturn in the wake of the central bank's monetary policy tightening to control inflation.

Powell said that the central bank would not allow a transition from a low inflation environment to a high inflation environment.

"We had expected that this year that growth would moderate to a more sustainable path. We also are, of course, raising interest rates and the aim of that is to slow growth down so that supply will have a chance to catch up," Powell added.

Traders also digested revised data from the Commerce Department that showed U.S. economic activity shrank slightly more than previously estimated in the first quarter of 2022.

The report showed the decrease in real gross domestic product in the first quarter was revised to 1.6% from the previously reported 1.5%. Economists had expected the drop in GDP to be unrevised.

The slightly bigger than previously estimated decline in GDP in the first quarter came on the heels of the 6.9% spike in GDP in the fourth quarter of 2021.

The dollar index climbed to 105.15, gaining more than 0.6%.

Against the Euro, the dollar firmed to $1.0442 from $1.0522.

The dollar strengthened to $1.2124 against Pound Sterling, gaining from $1.2187.

Against the Japanese currency, the dollar climbed higher, fetching 136.64 yen a unit, up from 136.15 yen Tuesday evening.

The dollar gained against the Aussie, strengthening to 0.6881 from 0.6905.

The Swiss franc gained against the dollar, firming to 0.9549 from 0.9576. The dollar moved up against the loonie, firming to 1.2891 from 1.2879 as oil prices fell after three successive days of gains.