Dollar edges up against euro, hits two-week high vs yen

U.S. hundred greenback notes are seen on this image illustration taken in Seoul February 7, 2011. REUTERS/Lee Jae-Received

LONDON, June 1 (Reuters) – The euro edged additional away from a one-month excessive on Wednesday and the U.S. greenback nudged up, lifted by greater Treasury yields as international inflation worries flared anew.

The greenback index , which measures the forex in opposition to six main friends, together with the euro, rose 0.2% to 101.96, extending Tuesday’s good points, when knowledge confirmed euro zone shopper inflation hovering to a file. learn extra

The euro was down 0.2% in opposition to the dollar, persevering with to edge again from a one-month excessive of $1.0787, reached on Monday, when nationwide inflation readings from the euro zone indicated a excessive print for the bloc.

“Belgian, Spanish and German inflation knowledge on Monday set the scene,” mentioned Jamie Dutta, market analyst at Vantage Markets.

“EUR/USD has approached the $1.08 degree, getting back from the depths of $1.0348, so what we have seen is known as a technical pullback,” Dutta added.

The greenback index hit a one-month low of 101.29 on Monday after pulling again from an almost two-decade excessive above 105 in mid-Might, as U.S. inflation and different financial indicators confirmed indicators of peaking amid the Federal Reserve’s aggressive coverage tightening.

A two-day increase has seen the index buying and selling again in the direction of 102.00.

“The dollar seems much less sluggish than it has been in current buying and selling periods, however its rebound makes an attempt stay removed from convincing,” UniCredit analysts mentioned in a analysis observe.

Markets have priced half-point rate of interest rises for the Fed’s conferences this month and subsequent, consistent with what policymakers have been signalling, however the outlook past that’s murky.

A month-to-month U.S. jobs report due on Friday might provide new clues.

The greenback was up 0.5% to 129.345 yen, having earlier touched 129.54, its highest since Might 17, as rising U.S. Treasury yields lifted the pair.

“Yield differentials between the U.S. and Japan are nonetheless discouraging any tentative makes an attempt to tug the pair in the direction of 125,” UniCredit mentioned.

Benchmark 10-year Treasury yields have been up 1.8 foundation factors at 2.8622%, having earlier touched their highest degree since Might 19 at 2.888%.

The unfold between U.S. and Japanese 10-year bond yields widened to 265 foundation factors, probably the most since Might 19.

Elsewhere, the U.S. greenback was little modified in opposition to its Canadian counterpart forward of the Financial institution of Canada’s rate-setting assembly at 1400 GMT, the place a 50-basis-point improve is extensively anticipated. learn extra

The Aussie greenback strengthened 0.2% to $0.7185 after knowledge confirmed Australian GDP rose 0.8% within the March quarter from the earlier quarter, topping market forecasts of a 0.5% acquire. The Kiwi greenback fell 0.1% to $0.65065.

Sterling was flat in opposition to the greenback at $1.2605, after the pound’s first optimistic month of the 12 months, with a small 0.2% rise snapping the earlier 4 months of losses.

China’s yuan slid for a second day, after posting three straight months of losses, monitoring the broad greenback energy in international markets. CNY/

In cryptocurrencies, bitcoin slipped 0.6% to $31,572. Ether was flat at $1,937.

Reporting by Samuel Indyk in London Further reporting by Kevin Buckland in Tokyo
Enhancing by Mark Potter

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