Dollar Consolidates as Traders Wait for Fed
A gauge of the dollar consolidated on caution before the Federal Reserve’s interest-rate decision this week.
The Bloomberg Dollar Spot Index eased less than 0.1%. It erased an intraday gain on Monday after US data showed a manufacturing slump worsened while services activity expanded
Most Group-of-10 currencies traded in narrow ranges while the yield on 2-year Treasuries lost one basis point to 4.24%
“The interest rate market pricing reflects expectations that the Fed may end its rate cut cycle sooner than expected given Donald Trump’s reflationary polices,” said Ken Cheung, strategist at Mizuho Bank in Hong Kong. “The rising UST yield advantage will likely continue to support USD before the Fed unveils its rate projection at the upcoming meeting”
USD/JPY eased 0.1% to 153.97
Strategists are warning that further yen weakness may trigger verbal intervention from authorities and add pressure on the BOJ to hike interest rates
NZD/USD slipped 0.1% to 0.5779
The New Zealand dollar was weighed by the government’s projection of deeper budget deficits and a delayed return to surplus
AUD/USD was little changed at 0.6369
EUR/USD inched up 0.1% to 1.0523
FX pair took gains into a third day with euro-area sentiment bolstered by the PMI figure for services which climbed to 51.4 from 49.5
Source : Bloomberg
