Dollar Increases in Asia in Busy Regional Data Flow

On Tuesday, the greenback increased in Asia in a busy regional data day that highlighted some weaker than expected statistics on trade in New Zealand and Australia and industrial production in Japan.

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On Tuesday, the greenback increased in Asia in a busy regional data day that highlighted some weaker than expected statistics on trade in New Zealand and Australia and industrial production in Japan.

The U.S. dollar index, which gauges the greenback’s strong point against a trade-weighted basket of six major currencies, increased 0.08% to 101.22, 08:12PM ET.

The trade balance in New Zealand for January came in at a deficit of NZ$3.470 billion year-on-year, wider than the NZ$3. 195 billion gap expected. NZD/USD traded at 0.7182, down 0.15% after the data.

In Japan, provisional industrial output fell 0.8% month-on-month in January, compared with a 0.3% surge  seen and retail sales increased a higher than expected 1.0%, with an 0.9% increase expected.

“USD/JPY declined 0.10% to 112.59 after the figures with the emphasis more on a speech by President Donald Trump later in the day to a joint-session of the U.S. Congress that could touch on trade policies as well as tax and spending plans,” according to the reports.

In Australia, private sector credit increased 0.2%, lower than 0.5% hike expected, while the current account for the 4th quarter came in at a deficit of A$3.9 billion, wider than the A$3.6 billion gap expected. AUD/USD plunged 0.01% to 0.7672.

Overnight, the U.S. dollar reversed prior losses against a slide of major currencies on Monday, as optimism surrounding a March interest rate hike increased.

The greenback  bounced off session lows, after Dallas Fed Reserve President Robert Kaplan speech in Oklahoma on Monday strengthened hopes of a march interest hike.

Mr. Kaplan restated his view that a rate hike should happen sooner rather than later in order to control rising inflation.

According to the report, 33% of traders anticipate the Fed to increase interest rates at its next meeting in March compared to only 26% of traders a day before.

The sharp reversal in the dollar comes ahead of an eagerly awaited speech by President Donald Trump to Congress on Tuesday.

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