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☆ Dollar holds firm before Fed rates decision
▼ + stars: | 2024-01-31 | by ( ) www.cnbc.com time to read: +3 min

On the day, the dollar index was up 0.1% to 103.51, just below Monday's 103.82 which matched last week's seven-week high. The Federal Reserve meanwhile is expected to hold U.S. interest rates steady on Wednesday but flag cuts are coming by dropping language indicating it is weighing further hikes. Interest rate futures price a roughly 43% chance of a Fed rate cut in March, down from 73% at the start of the year. A slowdown in Germany would foreshadow the same in Eurozone numbers due on Thursday and reinforce market expectations that European policymakers could start rate cuts earlier than the ECB has signalled. Expectations of interest rate cuts in China have driven a strong rally in the bond market this month while the yuan has been squeezed by flight from China's crumbling equity markets.

Persons: Jerome, Powell, Dane Cekov Organizations: Bank of Japan, Federal Reserve, Federal, U.S, French EU, ECB, Bank of Locations: U.S, Germany, China

☆ Dollar rebounds, Fed officials take center stage
▼ + stars: | 2023-11-06 | by ( Karen Brettell | ) www.reuters.com time to read: +4 min

Comments from other Fed officials will also be evaluated for signs on whether they expect further rate increases. “Next week’s CPI print is going to be the best adjudicator we have on whether or not the Fed needs to hike rates again,” said Rai. The dollar index was last up 0.13% on the day at 105.19 after earlier dropping to 104.84, the weakest since Sept. 20. The yen hit 151.74 per dollar last week, edging close to October 2022 lows that spurred several rounds of dollar-selling intervention by the Bank of Japan. The Australian dollar fell 0.34% to $0.6491, after earlier reaching a three-month high of $.6523.

Persons: Dado Ruvic, Jerome Powell, ”, Bipan Rai, Lisa Cook, “, Rai, Dane Cekov, Cekov, Karen Brettell, Samuel Indyk, Jonathan Oatis, Aurora Ellis Organizations: REUTERS, U.S, Federal, CIBC Capital Markets, Market Committee, Fed, Bank of Japan, Reserve Bank of Australia, Thomson Locations: North American, Toronto, U.S, London

☆ Dollar dips on growing bets Fed rate hikes are over
▼ + stars: | 2023-11-06 | by ( Karen Brettell | ) www.reuters.com time to read: +3 min

Comments from other Fed officials will also be evaluated for signs on whether they expect further rate increases. “Next week’s CPI print is going to be the best adjudicator we have on whether or not the Fed needs to hike rates again,” said Rai. The dollar index was last down 0.03% on the day at 105.02 and got as low as 104.84, the weakest since Sept. 20. Cekov said the yen likely needs to be around the 155 per dollar area for Japanese authorities to consider intervention or to talk the currency up. The yen hit 151.74 per dollar last week, edging close to October 2022 lows that spurred several rounds of dollar-selling intervention by the Bank of Japan.

Persons: Dado Ruvic, Jerome Powell, ”, Bipan Rai, “, Rai, Dane Cekov, Cekov, Sterling, Karen Brettell, Samuel Indyk, Jonathan Oatis Organizations: REUTERS, U.S, Federal, CIBC Capital Markets, Market Committee, Bank of Japan, Thomson Locations: North American, Toronto, U.S, London

☆ Dollar extends drop, still vulnerable after Fed
▼ + stars: | 2023-11-06 | by ( Samuel Indyk | ) www.reuters.com time to read: +4 min

The dollar index was hovering around a 6-1/2 week low of 104.84, after falling around 1.4% last week. "You could still see a somewhat weaker dollar in the short-term, but if the (euro-dollar) rally continues it needs to get some fuel from somewhere." JPMorgan analysts say a sustained dollar sell-off would need signs of improvement in the euro zone, China and other regions, which it says are "still tenuous". The latest growth and inflation data from the euro zone and manufacturing surveys from China bear that out. Euro zone recession fears hardened on Monday after a survey showed a downturn in business activity accelerated last month as demand in the services sector weakened further.

Persons: Dado Ruvic, Tina Teng, Dane Cekov, Adrian Prettejohn, Jerome Powell, Nordea's Cekov, Sterling, bitcoin, Samuel Indyk, Rae Wee, Vidya, Kirsten Donovan, Mark Potter Organizations: REUTERS, U.S, Federal, Aussie, CMC Markets, JPMorgan, Economics, European Central Bank, Bank of Japan, Thomson Locations: Auckland, China, U.S

Japanese yen and U.S. dollar banknotes are seen with a currency exchange rate graph in this illustration picture taken June 16, 2022. The yen eased to 149.83 per dollar, its weakest in more than 11 months, moving ever closer to the 150 mark that some traders believe could prompt intervention by Tokyo to support the currency. "If the yen breaks 150 per dollar, which I think is likely, and verbal intervention is not followed by action then we could see dollar-yen at 155." In the broader currency market, sterling was last 0.4% lower at $1.2158, having slid nearly 4% against the dollar in the third quarter. Elsewhere, the Australian dollar slid 0.6% to $0.6395, while the New Zealand dollar edged 0.4% lower to $0.5972, as traders looked ahead to rate decisions from their respective central banks this week.

Persons: Florence Lo, Dane Cekov, Shunichi Suzuki, Jarrod Kerr, Nordea's Cekov, bitcoin, Samuel Indyk, Rae Wee, Shri Navaratnam, Simon Cameron, Moore, Emelia, Alex Richardson Organizations: U.S, REUTERS, Bank of Japan, Bank of Japan's, Finance, Congress, Democratic, Australian, New Zealand, Thomson Locations: Tokyo, Britain, U.S

China's onshore yuan meanwhile ended its domestic session at the weakest since 2007, as it battles capital outflow pressures and a widening yield gap with major economies. The U.S. dollar index , which measures the greenback against major peers, was last 0.05% lower at 105 but remained not far from the previous session's six-month high of 105.15. IN THE DOLDRUMSThe onshore yuan opened at 7.3400 per dollar on Friday and touched its weakest level since December 2007 at 7.3510, while its offshore counterpart sank to a 10-month low of 7.3621 per dollar. The onshore yuan has fallen roughly 6% against the dollar so far this year and has become one of the worst-performing Asian currencies alongside its offshore counterpart. The Australian dollar was last 0.28% higher at $0.6395, but eyed a weekly loss of over 0.8%.

Persons: Dado Ruvic, Dane Cekov, Nordea's Cekov, Sterling, Vishnu Varathan, Shunichi Suzuki, Samuel Indyk, Rae Wee, Shri Navaratnam, Gerry Doyle, Angus MacSwan, Mark Heinrich Our Organizations: REUTERS, U.S, Nordea, Mizuho Bank, Finance, Bank of Japan, Bank of, Australian, New Zealand, Thomson Locations: U.S, Germany, Europe's, Europe, United States, Bank of Japan

Higher rates benefit the dollar by improving its yield and as traders look for safety while global stockmarkets drop. The dollar hit a two-month high against the euro of $1.0524 , extending Tuesday's 1.2% jump. The Australian dollar has weakened for a similar reason as the Reserve Bank of Australia has softened its tone. Having dropped over 2% on Tuesday, the Australian dollar weakened a bit more to hit a four-month low of $0.6568 on Wednesday. China's yuan finished the domestic session at 6.9706 per dollar, the weakest such close since Dec. 29, 2022.

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