Dollar Up for Third Day Ahead of CPI; Yen Falls
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 yen retreated while the euro fell to its weakest mark since 2022 versus sterling.
The Bloomberg Dollar Spot Index rises 0.1%, earlier reached a nearly two-week high.
Treasuries fall across curve, two-year yield up 2.5bp to 4.15%.
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 0.82392 session low, the weakest 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 152.18.
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 0.6365 low after RBA meeting, where officials signaled confidence inflation is slowing; NZD/USD down as much as 1.2% to 0.5792 low.
Source : Bloomberg
