Dollar steady

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SINGAPORE- The dollar held broadly steady on Tuesday ahead of key US inflation data due later in the day, while the yen firmed near a one-month high on mounting expectations the Bank of Japan could exit negative interest rates as early as next week.

In cryptocurrencies, bitcoin hovered above $72,000 and was just a whisker away from surpassing a record high made in the previous session.

Against the dollar, the euro retreated from a roughly two-month high hit last week and last bought $1.0931. Sterling rose 0.08 percent to $1.2822, though was similarly some distance away from Friday’s more than seven-month peak.

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Currency moves were subdued and the greenback halted its recent decline ahead of a reading on US inflation out later on Tuesday that will provide further clarity on how soon the Federal Reserve could commence its rate easing cycle this year.

While expectations are for core consumer prices to have risen 0.3 percent on a monthly basis in February, investors will be looking closely for any upward surprises as was the case in January, which could derail the pace of expected Fed rate cuts.

“Were we to get a 0.2 percent , I think the market will be back on the scent of a possible May first Fed rate cut, and if we were to get a 0.4 percent , I think the market will be casting some doubt on a cut as early as June,” said Ray Attrill, head of FX strategy at National Australia Bank (NAB).

“So in that sense, I think it’s right to think that there will be a high degree of market sensitivity to anything other than a 0.3 percent core print.”

The Australian dollar rose 0.01 percent to $0.6615, while the New Zealand dollar edged 0.02 percent lower to $0.61685.

The dollar index was little changed at 102.80, having hit a roughly two-month low of 102.33 last week.

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