Dollar Consolidates Amid Thinned Holiday Trading
The Bloomberg Dollar Spot Index was steady after falling 0.5% on Friday, triggered by lower-than-expected key inflation data. The yen was the only currency trading lower against the dollar, though moves were muted
The soft PCE data “gave the market a good excuse to take some profit” off the dollar’s recent rally but doesn’t change the outlook for the Fed next year, said Nick Twidale, chief analyst at AT Global Markets in Sydney. “If you step back and just take a look at the overall fundamentals, I still think there’s every reason to keep buying the dollar into the start of next year”.
USD/JPY rose as much as 0.2% before steadying to 156.54.
With liquidity thin given the holiday-trading period, speculators are “still buying dollar-yen on dips at the moment,” AT’s Twidale said.
On Friday, Japanese Finance Minister Katsunobu Kato and currency chief Atsushi Mimura both warned that they’ll take appropriate action against excessive moves.
AUD/USD rose 0.1% to 0.6257; NZD/USD was up 0.1% to 0.5658.
EUR/USD climbed 0.1% to 1.0439.
Source: Bloomberg
