Dollar catches its breath after scaling 14-year peak
The dollar caught its breath in early Asian trading on Thursday, after charging to a 14-year high against a basket of currencies on bets the Trump administration will adopt inflationary policies.
The dollar index, which tracks the greenback against six major rival currencies, retreated 0.2 percent to 100.260 .DXY, after climbing as high as 100.57 on Wednesday, its loftiest peak since April 2003.
Only a surprise will halt December Fed rate hike: Bullard
The Federal Reserve will hike U.S. interest rates in December barring any major shocks, policymaker James Bullard said on Wednesday, adding that a single rate increase may be enough to move monetary policy to a "neutral setting".
Bullard also said that the Fed would need to respond to any economic uncertainty created by "political actors" but that global markets had reacted more calmly than some had predicted to Donald Trump's shock U.S. presidential election victory.
"You would have to have a surprise at this point," for the Fed not to increase rates, Bullard, who is a voting member of the U.S. central bank's rate-setting committee, told reporters at a UBS banking conference in London.
Fed unshaken by U.S. election, focused on rate hikes: Mester
The Federal Reserve must not overreact to market moves following the shock U.S. presidential election in part because it is too early to predict any new spending and trade policies, so the plan remains for gradual interest rate hikes, Cleveland Fed President Loretta Mester said in an interview.
"The markets react and then they react again," she told Reuters on Wednesday. "You have to be careful about overreacting to them ... because they don't know more than anyone else about what the (fiscal) package will look like."
"My path may be a little bit above the consensus path," Mester said of expected rate hikes. "The economy is getting back to both parts of our goals (so) it just seems appropriate to start moving rates up," she said, referring to the Fed's inflation and employment targets.
Fed's Harker says he supports an interest rate hike
Philadelphia Federal Reserve President Patrick Harker said he favored raising interest rates and that the U.S. central bank might have to hike more aggressively if the incoming Trump administration enacts a fiscal stimulus.
"We may need to have a steeper path" of rate increases, Harker told reporters on Wednesday, adding that the Fed would try not to cause a recession with rate increases.
Oil prices fall on U.S. crude stock build, OPEC remains in focus
Crude oil futures dropped on Thursday after official inventory reports indicated a larger-than-expected build in U.S. oil stocks.
Crude inventories in the United States rose by 5.3 million barrels in the week to Nov. 11, compared with expectations for an increase of 1.5 million barrels.
The climb in inventories was mainly due to higher imports that averaged 910,000 barrels per day (bpd), according to data released by the U.S. Energy Information Administration on Wednesday.
U.S. benchmark WTI crude CLc1 was down 11 cents, or 0.24 percent, at $45.46 a barrel at 0040 GMT. European ICE Brent LCOc1 crude futures fell 16 cents, or 0.34 percent, to $46.47 per barrel.
Reference: Reuters
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