The dollar rose on Tuesday
The dollar rose against the yen and euro on Tuesday, boosted by an upbeat U.S. manufacturing sector survey, while the pound wallowed near a three-decade low on concerns over a potential "hard Brexit" for Britain.
The greenback was on the front foot after an Institute for Supply Management (ISM) survey showed the U.S. manufacturing sector returned to expansion in September. ECONUS
The dollar also firmed against the yen because of a reduction in risk aversion, as concerns over Deutsche Bank have eased for now.
The U.S. currency was particularly strong against the pound, which has declined steadily since British Prime Minister Theresa May set a March deadline to begin the UK's formal departure process from the European Union.
The dollar index .DXY rose 0.2 percent to 95.893.
Fed’s Mester Says Case for November Hike Will Likely Be Strong
Federal Reserve Bank of Cleveland President Loretta Mester said the economy is ripe for an interest-rate increase and repeated that the Fed’s November meeting should be viewed as “live” for a policy decision, despite its proximity to the U.S. presidential election.
“I would expect that the case would remain compelling” for a rate hike when the Federal Open Market Committee gathers in Washington Nov. 1-2, the week before Americans head to the polls, she told Kathleen Hays in an interview on Bloomberg Television Monday. Mester added that politics wouldn’t affect the decision.
Japanese companies' inflation expectations drop, adding to BOJ's struggle
Japanese companies cut their forecasts for inflation for coming years, underscoring the difficulty Bank of Japan Governor Haruhiko Kuroda faces as he struggles to hit the central bank's price target of two per cent.
The BOJ's survey of companies' average inflation outlook shows: Japanese companies forecast prices will rise 0.6 per cent in one year, compared with 0.7 per cent forecast in a June survey.
Companies expect one per cent inflation in three years, down from 1.1 per cent projected in June. Companies also see one per cent inflation in five years, compared with a 1.1 per cent estimate in the previous survey.
The price outlook among companies contrasts with the BOJ's. The central bank has said inflation will reach its two per cent target during the fiscal year ending in March 2018. Consumer prices excluding fresh food fell for a sixth straight month in August, by 0.5 per cent.
Oil dipped on Tuesday.
Oil prices dipped on Tuesday on a rise in Iranian exports that adds to a global supply overhang, but a planned OPEC-led production cut later this year offered some support.
U.S. West Texas Intermediate (WTI) crude CLc1 was down 25 cents at $48.56 a barrel.
Traders said prices were dented by the latest rise in Iranian crude and condensate sales, which likely reached about 2.8 million barrels per day (bpd) in September, almost matching a 2011 peak in shipments before sanctions were imposed on the OPEC producer.
Reference: Reuters,Bloomberg
Thai
Eng