U.S. dollar rises vs most currencies as Fed taper talk gathers pace
The dollar climbed to a two-week peak against a basket of currencies on Monday, bolstered by expectations the U.S. Federal Reserve could reduce its asset purchases by the end of the year despite a surge in COVID-19 cases.
The dollar index earlier rose to 92.887, its highest since Aug. 27. It was last up slightly at 92.664.
A round of U.S. economic data is due out this week, starting with consumer prices on Tuesday, which will give the latest update on how hot inflation has been ahead of next week’s Fed meeting.
Philadelphia Fed President Patrick Harker became the latest official to say he wants the central bank to start tapering this year, saying in a Nikkei interview that he was keen to scale back asset purchases.
Tapering talk has boosted the dollar, said Erik Nelson, macro strategist at Wells Fargo Securities in New York.
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The euro was among the currencies to lose ground to the dollar, dipping to $1.1770, its lowest in a little over two weeks, after the European Central Bank said last week it would start to trim its own emergency bond purchases. The euro was last down 0.1% at $1.1801.
Against the yen, the dollar was up 0.1% at 110 yen. The dollar also gained 0.5% versus the Swiss franc to 0.9228.
TREASURIES-U.S. yields dip with eyes on inflation data
U.S. government bond yields dipped on Monday as traders look ahead to data on Tuesday that is expected to show a continuing slowdown in the pace of consumer price increases.
The yield on 10-year Treasury notes was down 1.8 basis points at 1.323%.
In the cryptocurrency market, bitcoin was down 2.8% at $44,762.
Litecoin, with a market cap of nearly $12 billion and one of the earliest digital currencies in circulation, fell 2.6% to $180.78, according to crypto data tracker CoinGecko, after Walmart Inc said a press release regarding the retailer’s partnership with the cryptocurrency was fake.
Litecoin rose as much as 27.4% on the fake news.
Reference: Reuters
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