On Tuesday, the greenback steadied as investors broadly anticipate the Fed Reserve to increase interest rates the approaching week and are waiting for indications on the likely pace of hikes, including this week’s U.S. job data, 12:37AM ET.
The dollar index, which gauges the dollar against a basket of six major peers, last traded at 101.65 (DXY), marking up from a one-week low of 101.22 on Monday.
A Fed policy decision is scheduled at the end of its March 14-15 meeting. On Friday, Fed Chair Janet Yellen stated increasing interest rates this month would be suitable, if jobs and inflation data hold up.
Although a hike next week is “near certain”, investors “are still uncertain if the Fed would increase rates three times this year,” said Takahiko Sasaki, market economist at Mizuho bank.
“Investors can’t take a big move before Friday’s U.S. jobs data and the Fed’s economic projections next week,” said Sasaki.
Concerns over President Donald Trump’s ability to concentrate on his promised economic policies remained after the U.S. leader alleged over the weekend that he was wiretapped by his predecessor, Barack Obama.
Other analysts say that the greenback would not see an additional rally unless Trump announces detailed economic policies.
The euro last stood at $1.0582, still short of its two-week peak of $1.064 touched on Monday.
“Francois Fillon won his party’s backing to be its candidate for French president, hours after a former prime minister Alain Juppe ruled out an election bid,” according to the report.
A poll on Friday had shown that if Juppe replaced Fillon as the center-right candidate, he would likely win the election’s first round, with centrist candidate Emmanuel Macron coming second – a scenario that would knock far-right leader Marine Le Pen out of the race.
Party leaders swung behind Fillon in spite of allegations that he had misused public funds.
The greenback inched up 0.1% against the yen to 113.92 yen after declining to a one-week low of 113.53 yen on Monday as geopolitical doubt prompted investors to purchase the perceived safe-haven Japanese currency.
On Monday, North Korea’s launch of four ballistic missiles had spurred yen-buying.
Markets had a quiet response to a stronger-than-expected U.S. factory orders. New orders for U.S.-made goods surges for a 2nd straight month in January, proposing the recovery of the manufacturing sector was gaining momentum.
The Australian dollar edged higher after the central bank kept interest rates unaffected and indicated no clue of considering another easing, highlighting the outlook for steady policy.
The Reserve Bank of Australia’s (RBA) March policy meeting ended with rates unmoved at 1.5%, as widely projected, and the accompanying statement was generally upbeat.
The Aussie last stood at 0.6% at $0.7621, after fetching $0.7633 on the policy decision.
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