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Dollar Down, Investors Await Further Inflation Data By

Dollar Edges Higher; Volatility Limited Ahead of Inflation Data

© Reuters.

By Gina Lee – The dollar was down on Friday morning in Asia but remained near multi-month highs as weary investors await further inflation data to close the week. The pound, meanwhile, nursed a modest loss after the shied away from hiking interest rates in its latest .

The that tracks the greenback against a basket of other currencies inched down 0.03% to 91.767 by 12:13 AM ET (4:13 AM GMT).

The pair inched down 0.01% to 110.84, with the yen just below a 15-month low against the dollar. Data released earlier in the day said that the grew 0% year-on-year in June, while the contracted 0.1% month-on-month in June, which was smaller than May’s 0.4% contraction.

The pair edged up 0.14% to 0.7592 and the pair was up 0.22% to 0.7074. Trade data from New Zealand said that and stood at a better-than-expected NZD5.87 billion and NZD5.4 billion respectively in May. The trade balance was at –NZD60 million while the figure was NZD469 million.

The pair inched down 0.10% to 6.4639 and the pair inched up 0.03% to 1.3926.

Investors are still digesting the U.S. Federal Reserve’s surprise hawkish turn as it handed down its during the previous week, although comments from Fed Chairman and other officials throughout the past week calmed market nerves about an imminent interest rate hike.

The Bank of England’s decision hinted that the central bank was in no hurry to hike interest rates, with officials warning against “premature tightening” as the decision was handed down on Thursday.

“Some in the market obviously positioned for a less dovish or a hawkish tilt,” National Australia Bank (OTC:) director of economics and markets Tapas Strickland told Reuters.

Meanwhile, the hiked its interest rates for the first time since late 2018, with the Mexican peso climbing to a two-week high after the surprise move.

Investors also digested U.S. economic data released on Thursday, which said that the rose 6.4% quarter-on-quarter in the first quarter of 2021. However, rose a smaller-than-expected 0.3% month-on-month in May.

On the employment side, 411,000 were filed over the past week, higher than the 380,000 claims in forecasts prepared by but lower than the 418,000 claims submitted during the previous week.

Further U.S. data on and the is due later in the day.

“The dollar can jump if inflation surprises to the upside… upside inflation surprises have been the trend in the U.S. recently,” Commonwealth Bank of Australia (OTC:) head of international economics Joe Capurso told Reuters.

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