Dollar edges up ahead of inflation data; yen falls
Core personal consumption expenditures data -- an inflation report closely watched by U.S. central bankers -- is due at 1230 GMT.
The dollar strengthened further on Friday following its rise from more than four-month lows in recent sessions, as investors waited for U.S. inflation data to set the currency’s direction.
The U.S. dollar index picked up in the late Asian and early European session, trading up 0.1% on the day at 90.78 at 0740 GMT.
The United States and Britain have a public holiday on Monday, meaning the dollar’s gains could be attributed to month-end demand.
Versus the yen, the dollar was near a seven-week high. The pair changed hands at 109.875, a move which prompted analysts to note Japan’s rise in unemployment, fall in consumer prices and news that the government is considering extending a state of emergency over the COVID-19 pandemic.
The euro was down 0.1% at $1.21875, hovering below its recent high of $1.2266, as dovish comments from European Central Bank officials sapped its momentum ahead of the policy meeting on June 10.
Yuan set for best week since Nov, regulators signal concerns over one-way bets
China's yuan extended gains against the dollar on Friday and looked set for its best weekly performance since November, but the pace of the rally slowed after regulators signaled some concerns over strong one-way bets on the currency.
Prior to the market opening, the People's Bank of China
(PBOC) set the midpoint rate at 6.3858 per dollar, firmer than the previous fix of 6.403.
Friday's official guidance rate was the strongest since May 2018 and set above the psychologically important 6.4 per dollar level. Traders and analysts saw the move as a nod from the authorities that they would allow spot yuan to trade between the
6.3 and 6.4 levels for the time being.
Reference: Reuters
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