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Dollar hits 14-year high as Yellen voices confidence in economy

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Dollar hits 14-year high as Yellen voices confidence in economy

Federal Reserve Chair Janet Yellen voiced her confidence in the U.S. economy in her speech Monday at a University of Baltimore commencement ceremony where she received an honorary degree.

This vote of confidence sent the dollar soaring to its highest level in 14 years, according to an article by Chelsey Dulaney for The Wall Street Journal.

Overall, the dollar has increased 5% since November, according to an article by CBS.

Yellen spoke about the improvements to the labor market such as the unemployment rate, which decreased to 4.6%, near its pre-recession level.

From the article:

The Fed’s optimism sent the dollar to a 14-year-high as higher rates make U.S. assets more attractive to yield-seeking investors. Some investors had expected Ms. Yellen could take a more cautious tone in her speech to damp enthusiasm in the markets.

Meanwhile, the dollar remained lower against the Japanese yen Monday ahead of the Bank of Japan’s policy decision overnight.

The speech comes after last week’s Federal Open Market Committee meeting in which the Fed raised rates, and hinted that next year could bring three more increases to the federal funds rate.