Dollar Up for Third Day; Pound Gains Versus Euro
A Bloomberg gauge of the dollar advanced for a third session, buoyed by higher Treasury yields and a softening in the rally in risk assets to start the week. The euro fell to its weakest mark since 2022 versus sterling.
The Bloomberg Dollar Spot Index rises 0.3%, trades near one-week high.
Treasuries fall across curve, two-year yield up 3.9bp to 4.16%.
Traders await US CPI data for clues on the Federal Reserve’s rate path.
“Though market sentiment is solidifying on a cut next week, bets on a subsequent cut in January have been reduced substantially and it now looks like an either/or situation when it comes to easing,” said Helen Given, a currency trader at Monex.
EUR/GBP fell 0.4% to 0.82441, the lowest level since March 2022.
Bets the Bank of England will cut interest rates less aggressively than the European Central bank are supporting sterling.
USD/JPY reverses an earlier drop to trade as much as 0.6% up at 152.17.
The Bank of Japan should raise its benchmark interest rate early, and it faces the risk it has already fallen behind the curve, according to a prominent economics professor who was an adviser to the prime minister.
Commodity currencies trade weaker as Monday’s risk rally eases.
AUD/USD falls as much as 1.1% to 0.6366 low after RBA meeting, where officials signaled confidence inflation is slowing; NZD/USD down as much as 1.2% to 0.5793 low.
Source : Bloomberg
