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Expand chart
Data: Investing.com; Chart: Axios Visuals

The dollar rose to its highest level in more than 2 years after the Federal Reserve's rate cut Wednesday, as currency markets got a reality check about the growth prospects of the greenback against the world's other currencies.

What's happening: Strategists have been expecting the dollar to weaken for the past 2 years, yet it has remained strong against global peers like the euro, pound and yuan. After Jerome Powell's Wednesday press conference, the dollar looks poised to rise to new highs.

Why it matters: President Trump has openly complained about the strong dollar's negative impact on U.S. businesses that generate significant revenue overseas — many of which are also suffering from the trade war. Continued appreciation now seems likely and could prompt action from the White House.

What they're saying: John Doyle, vice president of dealing and trading at Tempus Inc., tells Axios that Wednesday's news conference marks a "recalibration" for investors in the currency markets.

  • If Powell and the Fed stand by the "mid-cycle adjustment" language used during Powell's press conference, the dollar could test its highs from March 2017.

Investors had been factoring in multiple rate cuts from the Fed in the next 12 months, but Powell reset expectations about the direction of U.S. monetary policy versus the rest of the world, Joe Manimbo, senior market analyst at Western Union Business Solutions, tells Axios.

  • "Today’s hawkish rate cut poured cold water on expectations for a series of rate cuts for the balance of the year," he said.
  • What happens next for the dollar will depend on what the other central banks bring to the table, Manimbo added. "If we see forceful action from the ECB in September, if the Bank of Canada joins the action, that could send the dollar flying significantly higher," he said.

Go deeper: Fed cuts interest rates for the first time since 2008

Go deeper

Updated 7 hours ago - Politics & Policy

Coronavirus dashboard

Illustration: Sarah Grillo/Axios

  1. Health: The good and bad news about antibody therapies — Fauci: Hotspots have materialized across "the entire country."
  2. World: Belgium imposes lockdown, citing "health emergency" due to influx of cases.
  3. Economy: Conference Board predicts economy won’t fully recover until late 2021.
  4. Education: Surge threatens to shut classrooms down again.
  5. Technology: The pandemic isn't slowing tech.
  6. Travel: CDC replaces COVID-19 cruise ban with less restrictive "conditional sailing order."
  7. Sports: High school football's pandemic struggles.
  8. 🎧Podcast: The vaccine race turns toward nationalism.
Dan Primack, author of Pro Rata
Updated 7 hours ago - Economy & Business

Dunkin' Brands agrees to $11B Inspire Brands sale

Photo: Alexi Rosenfeld/Getty Images

Dunkin' Brands, operator of both Dunkin' Donuts and Baskin-Robbins, agreed on Friday to be taken private for nearly $11.3 billion, including debt, by Inspire Brands, a restaurant platform sponsored by private equity firm Roark Capital.

Why it matters: Buying Dunkin’ will more than double Inspire’s footprint, making it one of the biggest restaurant deals in the past 10 years. This could ultimately set up an IPO for Inspire, which already owns Arby's, Jimmy John's and Buffalo Wild Wings.

Ina Fried, author of Login
9 hours ago - Technology

Federal judge halts Trump administration limit on TikTok

Illustration: Aïda Amer/Axios

A federal judge on Friday issued an injunction preventing the Trump administration from imposing limits on the distribution of TikTok, Bloomberg reports. The injunction request came as part of a suit brought by creators who make a living on the video service.

Why it matters: The administration has been seeking to force a sale of, or block, the Chinese-owned service. It also moved to ban the service from operating in the U.S. as of Nov. 12, a move which was put on hold by Friday's injunction.

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