U.S. Dollar Climbs As Fed Chair Jerome Powell Signals Continued Policy Tightening

(RTTNews) - Extending the previous day's rally, the U.S. dollar advanced against its major counterparts in the European session on Thursday, as comments from Federal Reserve Chairman Jerome Powell dampened hopes of a potential pivot in the monetary policy.

The Fed lifted its benchmark rate by 75 basis points to a range of 3.75 percent to 4 percent and Powell said that it was "premature" to consider a pause in future hikes.

The Fed chief said that the central bank has ways to go with interest rates before it get to the level that's sufficiently restrictive.

Powell added that rates are likely to go higher than previously expected, raising the possibility of a 5 percent terminal rate by next May.

Investors await U.S. non-farm payrolls report due on Friday for more clues on the central bank's tightening path.

The greenback appreciated to near 2-week highs of 1.0116 against the franc and 0.9761 against the euro, off its early lows of 1.0004 and 0.9840, respectively. The greenback is seen finding resistance around 1.03 against the franc and 0.95 against the euro.

The greenback touched 1.1251 against the pound, its strongest level since October 21. If the currency rises further, 1.10 is possibly seen as its next upside target level.

The greenback recovered from its early lows of 0.5838 against the kiwi, 0.6372 against the aussie and 1.3682 against the loonie, rising to an 8-day high of 0.5764, 9-day high of 0.6305 and a 10-day high of 1.3772, respectively. The next likely resistance for the greenback is seen around 0.55 against the kiwi, 0.60 against the aussie and 1.40 against the loonie.

The greenback edged up to 148.30 against the yen, from an early low of 147.11. The greenback is likely to find resistance around the 154.00 level.

Looking ahead, Eurozone jobless rate for September is due in the European session.

The Bank of England's monetary policy announcement is due at 8:00 am ET. The BoE is widely expected to raise its key rate by 75 basis points to 3 percent from 2.25 percent.

U.S. and Canadian trade data for September, U.S. weekly jobless claims for the week ended October 29, factory orders for September and ISM non-manufacturing PMI for October, as well as Canada building permits for September will be released in the New York session.