He dollar stayed close to its recent highs on Monday As investors digested the announcements of weekend china stimuluswhich some considered disappointing, and the euro continued its fall pending the central bank meeting this week.
He dollar index rose 0.1% to 103.13a little below last week’s high which was its highest level since mid-Augustas traders reduced bets on further massive rate cuts by the Fed at the remaining meetings this year.
“The dollar also found support in the fact that other central banks could cut interest rates more than the US”said an operator.
What data does the market look at?
US data from last week, which showed slightly higher-than-expected consumer inflation, but higher weekly jobless claimsthey left intact the forecasts that the Federal Reserve will cut rates by 25 basis points in November and December.
The euro fell 0.1% to $1.092, falling for the 11th time in 12 sessionsas investors were almost certain of a 25 basis point interest rate cut by the European Central Bank at its meeting on Thursday, while data pointed to a deterioration in activity in the euro zone.
Current indicators point to continued weakness in the German economy in the final quarterthe Ministry of Economy said on Monday. Meanwhile, credit rating agency Fitch on Friday revised France’s outlook to “negative” from “stable,” citing rising fiscal policy and political risks.
“Germany is still mired in stagflation and France has its own problems with the budget and growth and that does not bode well for the euro”said Jane Foley, head of foreign exchange strategy at Rabobank.
The pound was down 0.2%, hovering around a one-month low of $1.30460.
The yen fell to its lowest level since early August against the dollar, to 149.640 yenin contained operations since the Japanese markets remained closed for holidays.
The Asian session was dominated by Beijing’s statements on fiscal stimulus. The Chinese yuan fell 0.4% against the dollar.
Source: Ambito
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