Dollar Up over Bets of Intensified Monetary Tightening Following Inflation Data By


© Reuters

By Zhang Mengying – The dollar was up on Monday morning in Asia as Friday’s red hot inflation data suggested more aggressive monetary tightening from the U.S. Federal Reserve.

The that tracks the greenback against a basket of other currencies gained 0.29% to 104.45 by 1:32 AM ET (5:32 AM GMT).

The pair was up 0.30% to 134.82. The yen rallied briefly late on Friday when Japan’s government and the central bank said that they were concerned about the yen’s recent sharp falls. The rare statement could be seen as a signal that Tokyo could intervene to support the currency. The will hand it down on Friday while investors expect little change from the BOJ.

“Rising overseas yields and energy prices coupled with continued dovish Bank of Japan messages have pushed USD/JPY to two-decade highs,” Barclays (LON:) analysts told Reuters. The pair is expected to trade between 131 and 136 this week.

“There are no clear thresholds above (2002 high) other than the round figures of 136, 137, and 138,” Barclays analysts added.

The pair fell 0.30% to 0.7029, and the pair fell 0.39% to 0.6345.

The pair was up 0.29% to 6.7282, while the pair edged down 0.16% to 1.2294.

Beijing announced on Sunday three rounds of mass testing as it saw new COVID-19 outbreaks, adding to investors’ concerns about a grim economic outlook.

The will hand down its policy decision on Thursday, it is expected to hike interest rates.

The released Friday rose 8.6% in May year-on-year, a fresh 40-year high, adding to investors’ concerns about a recession caused by aggressive monetary tightening.

The inflation data also sent the benchmark U.S. 10-year yield higher, touching 3.2% on Monday morning, having gained nearly 12 basis points on Friday.

The Fed will hold its June meeting Wednesday, where it is expected to deliver half-point interest rate hikes.

On the data front, the U.S. is due on Tuesday, and China’s key economic activity data including is due the day following.

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