· The dollar edged higher against the yen on Tuesday, pulling away from a recent four-month low, as concerns over tensions between the United States and North Korea eased for now, supporting risk appetite.
Traders said the greenback also gained a lift after New York Fed President William Dudley said in an interview with the Associated Press that he would be in favor of another interest rate hike this year if the economy evolved in line with his expectations.
The dollar rose 0.4 percent to 110.04 yen JPY=, pulling further away from a near four-month low of 108.72 yen set on Friday.
The dollar gained against a basket of currencies, with the dollar index edging up to 93.499 at 8:04 a.m. HK/SIN compared to levels around the 93.1 handle seen at the end of last week.
· A leading dove on the U.S. central bank said his opponents are telling each other “a ghost story” about higher wage inflation that has gotten them spooked and eager to raise short-term interest rates.
Kashkari has been the lone dissenter against the central bank’s two rate hikes this year. He has argued the Fed should pause raising rates until inflation reemerges.
“I think they are making different decisions because they are very worried about accelerating inflation,” specifically an acceleration in wages, Kashkari replied.
· “I actually want to now see more evidence that we’re making progress in reaching our inflation objective,” Dallas Fed President Robert Kaplan said Friday after the report. He said he feels comfortable that the current level of interest rates “is the perfect place for us to be.”
· Odds in financial markets for a December rate increase stood at 30 percent after the data, unchanged from before the report.
· One of the Federal Reserve's most influential members expects to raise interest rates once more this year, and to soon begin shedding some of the Fed's bond holdings, according to comments on Monday that pushed back on doubts in financial markets.
Moreover, he told the Associated Press he supported another rate increase this year if the economy improves further.
· North Korea's leader has delayed a decision on firing missiles toward the U.S. territory of Guam while he watches the actions of the United States a little longer, the North's state media said on Tuesday, as Washington warned it would take out any missile heading for the Pacific island.
· Oil finished higher Friday, finding some support as data showed that the number of active U.S. oil rigs rose only slightly for the week, raising the likelihood that drilling activity has stabilized.
September West Texas Intermediate crude CLU7, +0.13% tacked on 23 cents, or 0.5%, to settle at $48.82 a barrel on the New York Mercantile Exchange. It was modestly trading lower before the rig data. For the week, WTI saw a loss of roughly 1.5%, according to FactSet data.
October Brent crude LCOV7, +0.14% on London’s ICE Futures added 20 cents, or 0.7%, to $52.10 a barrel, with prices losing about 0.6% for the week.
· Oil prices tumbled more than 2.5 percent on Monday in volatile trade, as dollar strength and weak domestic demand data in China hammered prices that had received a short-lived boost on concerns about potential reductions in crude supply from Libya.
Global benchmark Brent crude futures LCOc1 settled down $1.37 or 2.63 percent at $50.73.
U.S. West Texas Intermediate crude futures CLc1 settled down $1.23, or 2.52 percent at $47.59 a barrel.
Reference: Market Watch, Reuters, Bloomberg, CNBC
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