Your current location is:{Current column} >>Text
Dollar soft amid bets for less hawkish Fed; sterling firms By Reuters
{Current column}79421People have watched
IntroductionBy Kevin BucklandTOKYO (Reuters) - The safe-haven U.S. dollar eased against major peers on Tuesday a ...
By Kevin Buckland
TOKYO (Reuters) - The 2021 Police are tracking Forex fraudsafe-haven U.S. dollar eased against major peers on Tuesday amid signs Federal Reserve rate hikes are putting the brakes on the world's biggest economy, while risk sentiment improved as Rishi Sunak prepared to become Britain's prime minister.
Sterling edged toward this month's highs, while the euro threatened to hit $0.99 for the first time since Oct. 6 ahead of Thursday's European Central Bank (ECB) policy meeting.
The yen held firm on the stronger side of 149 per dollar following suspected Bank of Japan (BOJ) intervention on Friday and Monday.
A retreat this week in long-term Treasury yields also helped support the Japanese currency, but the policy background for yen weakness is likely to be put in stark relief in coming days: the BOJ is expected to stick to monetary stimulus on Friday, while the Fed is likely to raise rates by another 75 basis points on Wednesday of next week.
The , which measures the currency against six major peers, eased to as low as 111.72, taking it close to Friday's low of 111.68, the weakest since Oct. 6. It last stood at 111.96.
The greenback softened after S&P flash PMI data overnight showed U.S. business activity contracting for a fourth straight month in October, the latest evidence of an economy slowing in the face of high inflation and rising interest rates.
Economists polled by Reuters expect the pace of rate increases to slow to 50 basis points in December, matching bets in money markets.
"Structurally there's still a lot to like about the U.S. dollar, but we're in a mean-reversion, sideways, choppy market at the moment," said Chris Weston, head of research at Pepperstone in Melbourne.
"I still think the dollar is the most beautiful currency to own in G-10."
Weston expects the dollar index could dip as low as 110 before resuming its uptrend to potentially test 115, which would be the highest since May 2002.
Yields on U.S. retreated to 4.2047% in Tokyo, after reaching multi-year peaks at 4.338% at the end of last week.
At 148.915 yen, the dollar was down from the 32-year high of 151.94 on Friday that appeared to trigger successive bouts of BOJ intervention. The dollar dropped as low as 144.55 on Friday and 145.28 on Monday.
The Ministry of Finance declined to comment on whether it had ordered intervention in recent days, though it did confirm intervention in September, which was the first yen-buying foray since 1998 by Japanese authorities.
"As a general rule, policymakers have their greatest impact on the market when they are transparent about their actions and objectives, so it is odd they refuse to confirm their intervention," Joseph Capurso, a currency strategist at Commonwealth Bank of Australia (OTC:), wrote in a client note.
"The refusal to confirm the intervention may reflect a desire to keep traders guessing and bear down on . Whatever the tactics, we still expect USD/JPY to recover within a few weeks after BOJ intervention ends."
Sterling added 0.24% to $1.13105, heading toward the high this month of $1.1493 from Oct. 5.
The euro was 0.16% stronger at $0.98875.
The ECB looks set to hike rates by 75 basis points on Thursday to try and rein in red-hot inflation.
The Australian dollar rose 0.14% to $0.6322 ahead of quarterly consumer price data on Wednesday. The Reserve Bank of Australia is due to hold a rate policy meeting next week.
New Zealand's dollar gained 0.31% to $0.57095.
China's currency extended the weakness seen since Chinese leader Xi Jinping's choice of leadership team at the twice-a-decade Communist Party Congress raised fears growth will be sacrificed for ideology-driven policies.
The slid to a near 15-year low on Tuesday after the central bank set the lowest mid-point since 2008. The dipped to a record 7.3650 per dollar.
Statement: The content of this article does not represent the views of FTI website. The content is for reference only and does not constitute investment suggestions. Investment is risky, so you should be careful in your choice! If it involves content, copyright and other issues, please contact us and we will make adjustments at the first time!
Tags:
Related articles
Debt limit meeting, China's Micron ban, Fed speak
{Current column}-- Top lawmakers in Washington prepare to meet to break an impasse in debt ceiling negotiations, wit ...
Read moreOil Rally Continues, Oblivious to U.S. Fuel Pile
{Current column}© Reuters. By Barani Krishnan- The New Year rally in oil showed no signs of slowing on Wednesda ...
Read moreOusted James Hardie CEO rejects claims over conduct, considers legal action By Reuters
{Current column}© Reuters. FILE PHOTO: A James Hardie factory is seen behind a fence in western Sydney September 24, ...
Read more
Popular Articles
- Dollar bounces as expectations of Fed rate hike climb By Reuters
- Costa Rica hydro plant gets new lease on life from crypto mining By Reuters
- Asian Stocks Down, Investors Digest Chinese Trade Data By
- Wall Street Opens Lower After Retail Sales, Bank Disappointments; Dow Down 280 Pts By
- Procter & Gamble, Schlumberger, Freeport McMoran: 3 things to watch By
- Wall St muted at open ahead of Powell testimony By Reuters
Latest articles
-
Asian stocks skittish after the Fed, Chinese markets reopen stronger By
-
Taiwan Semiconductor, Delta Air, Producer Prices: 3 Things to Watch By
-
After flying start, Stellantis must tackle Tesla and China By Reuters
-
U.S. studies highlight the need for COVID boosters to fight Omicron By Reuters
-
Republican hopefuls woo evangelicals in Iowa, vow to restrict abortion By Reuters
-
Shares, bonds brace for high U.S. inflation, hawkish Fed By Reuters