The US dollar just crossed its highest value since 2002, on Thursday, thanks to strong earnings reports that offset six consecutive weeks of poor performance and underwhelming US economic data.
Perhaps the dollar’s rise might have something to do with the yen dipping to a 20-year low on the heels of Banks of Japan promising unrestricted purchasing of 10-year bonds. Japan hopes this move—an unlimited amount of 10-year bonds—will ensure they reach their yield target and strengthen their commitment to keeping extremely low-interest rates.
This move from the Bank of Japan stands in quite a contrast to present investor concerns. Mostly, investors are convinced that US interest rates are on the verge of a sharp rise: and this is what has provided that upward jolt for the dollar’s value.
Fortunately for the dollar, sluggish emerging market currencies have reinforced higher borrowing costs for the US dollar throughout currency derivatives. This has also helped to boost the value of the dollar. The effects of a weaker euro and yen have certainly contributed to buoying the dollar, pushing it to 103.930—its highest level since December of 2002.
At the same time, oil prices are picking up steam on reports that Germany is not able to oppose a Russian oil embargo. This, then, could lead to yet more restrictions on global supply distribution.
All in all, the Dow Jones Industrial Average increased more than 1.8 percent, on Thursday, by 604.71, to 33,906.64. In addition, the Standard & Poors 500 saw upward movement of 103.21 points, to 4,287.17; that is a jump of nearly 2.5 percent. Finally, the Nasdaq Composite grew by more than 3 percent, by 382.83, to 12,871.76.
Obviously, tech stocks saw the biggest gains. These gains were led mostly by a big rally from Facebook’s parent company Meta Platforms. By end of day, on Thursday, Meta was up more than 18 percent.
