September 30, 2023

Market Analysis September 2023: FX Market Focuses on US Dollar Strength

The FX market is focused on the US dollar due to central bank interest rate hikes. The US dollar's strength is impacting individuals and businesses worldwide.
Written by
Alec Whitten
Published on
September 30, 2023

In-Depth Analysis of Currency Changes and What They Mean This Month

The foreign exchange (FX) market has experienced a period of focused activity in September, as investors reacted to a number of central bank actions around the world. The US Federal Reserve raised interest rates by 0.75%, the largest single rate hike in nearly three decades. This move was seen as a sign that the Fed is serious about combatting inflation, and it led to a strengthening of the US dollar against most major currencies.

The Bank of England also raised interest rates in September, by 0.5%. This was the fifth consecutive rate hike for the BoE, and it reflected the bank's concerns about rising inflation in the UK. The BoE's move also helped to support the pound sterling, which had been under pressure in recent months.

Looking ahead, the FX market is likely to remain focused on the US dollar in the near term. The Federal Reserve is expected to continue raising interest rates, and this could further strengthen the dollar. However, investors will also be watching for signs of a slowdown in the US economy, as this could put downward pressure on the dollar.

Impact on Individuals and Businesses

The strengthening of the US dollar against most major currencies is having a significant impact on individuals and businesses around the world.


Travelers from the United States are finding that their money goes further when they travel to Europe and Japan. This is because the value of their currency has increased relative to the euro and the yen.

Expats who receive their income in US dollars are finding that their money is worth more when they convert it to their local currency. This can make it easier to make ends meet, especially if they are living in a country with a low cost of living.

Investors who hold US dollar-denominated assets are seeing the value of their investments increase. This can be a major benefit for retirees and other investors who are relying on their investments to provide them with income in retirement.


Exporters from the United States are finding that it is more profitable to export their goods to Europe and Japan. This is because the value of their currency has increased relative to the euro and the yen, making their goods more competitive in these markets.

Importers who import goods from Europe and Japan are finding that it is less expensive to import their goods. This is because the value of their currency has increased relative to the euro and the yen, making US goods less expensive in their local markets.

Multinational corporations with operations in multiple countries are finding that their profits are being boosted by the stronger US dollar. This is because their profits from foreign operations are worth more when they are converted back into US dollars.

SafeExchange: Your Trusted Partner in Navigating FX Market Volatility

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In this time of economic uncertainty, SafeExchange is committed to providing our clients with the best possible FX solutions and services. We can help you to manage your FX risk and protect your profits, so that you can focus on your business and achieve your financial goals.

Contact SafeExchange today to learn more about how we can help you navigate FX volatility.

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