Dollar jumps to 2-week high ahead of Federal Reserve meeting

US dollar jumped on Tuesday to a two-week high against a basket of global currencies to resume its gains, which were temporarily halted yesterday amidst a day of respite, as demand on the US currency renewed as the best investment currently in the foreign exchange market, ahead of Federal Reserve meeting which is expected to provide clear evidence about the prospects for US interest rate cuts this year.

The dollar index rose more than 0.2% to 97.75 points, the highest since June 3, from the opening level of 97.53 points, with the lowest level at 97.37 points.

The index lost about 0.1%, the first loss in four days, amidst a day of respite early in the week.

Over the past week, the dollar index rose by 1.05%, the second weekly gain in the last three weeks, and the biggest weekly gain since March, as demand on the US currency accelerated as the best alternative investment in the foreign exchange market.

On Tuesday, the US dollar saw an accelerated demand as the best investment in the foreign exchange market, especially after negative pressure on major and minor currencies. as well as Euro falling under the pressure from central bank governor Mario Draghi's remarks on expanding stimulus if economic conditions deteriorate more.

Also British pound faces strong prospects of UK secession from the EU without a deal, and the Australian dollar faces the likelihood of Australian interest rates cut this year to counter the slowing economy.

The monetary policy meeting of the US Federal Reserve will begin later today, with its decisions to be released tomorrow, amid full prospects for US interest rates to remain unchanged at 2.50%.

Investors are focusing on monetary policy data and economic forecasts, as well as comments by Federal Reserve Chairman Jerome Powell, on the lookout for new evidence of US interest rate cuts this year.