TOKYO – The dollar hovered near two-week lows against a basket of currencies on Tuesday with trade seen driven by month-end flows as investors looked ahead to US jobs figures later in the week.
The US currency steadied from falls after Federal Reserve Chair Jerome Powell on Friday offered no signal on when the central bank plans to cut its asset purchases beyond saying it could be “this year.”
“The payroll data will be the next highlight given the focus on the Fed’s taper. A strong reading will boost expectations the Fed will give markets prior notice in September before a formal decision in November,” said Yukio Ishizuki, senior strategist at Daiwa Securities.
Weaker jobs numbers could instead cement a case for later action – a pre-announcement in November with a formal decision in December.
Trade on Tuesday, however, is likely to be driven more by month-end flows from various businesses for their import and export transactions.
In early trade, the euro held firm at $1.1799, near Monday’s three-week high of $1.1810.
Sterling fetched $1.3762 while the yen was little changed at 109.98 yen to the dollar.
The dollar index stood at 92.698, near Monday’s two-week low of 92.595.
The offshore Chinese yuan stood at 6.4648 per dollar, not far from a three-week high of 6.4595 touched on Friday.
