Dollar Drops, But Recovers Some Ground As Market Awaits Inflation Data, Powell Speech
(RTTNews) - The U.S. dollar drifted lower on Monday, weighed down by lower bond yields, as traders looked ahead to crucial inflation data, and awaited Fed Chair Jerome Powell's speech on Wednesday.
However, the currency regained some lost ground after hawkish comments from Fed Vice Chair Jefferson who said that it would be appropriate for the central bank to maintain the policy rate in restrictive territory, and a report from the Federal Reserve Bank of New York that says the country is bracing for generally higher inflation pressures over the next few years.
The Survey of Consumer Expectations released by The Federal Reserve Bank of New York's Center for Microeconomic Data said median inflation expectations increased to 3.3% from 3.0% at the one-year horizon, decreased to 2.8% from 2.9% at the three-year horizon, and increased to 2.8% from 2.6% at the five-year horizon.
The dollar index, which dropped to 105.06, recovered to 105.23 later on in the session, but still remained below the flat line, losing 0.07%.
Against the Euro, the dollar weakened to 1.0790 from 1.0773. The dollar eased to 1.2555 against Pound Sterling, losing about 0.25%. Against the Japanese currency, the dollar strengthened to 156.22 yen.
The dollar was a bit weak against the Aussie at 0.6606. The Swiss franc weakened to 0.9081 a dollar, after having firmed to 0.9045 a dollar earlier in the day. The dollar drifted down slightly against the Loonie to $1.3669.
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