Dollar Up, but Near One-Month Low After ECB Policy Decision Strengthens Euro By Investing.com

By Gina Lee

Investing.com – The dollar was up on Friday morning in Asia but remained near its weakest level in a month. A stronger euro, as investors bet on earlier European interest rate hikes, capped gains for U.S. currency.

The that tracks the greenback against a basket of other currencies inched up 0.07% to 93.388 by 12:16 AM ET (4:16 AM GMT).

The pair inched up 0.07% to 113.64. Japanese data released earlier in the day showed that the grew 0.1% year-on-year, while the contracted 0.2% month-on-month, in October. contracted 5.4% month-on-month, the was at 1.16 and the at 2.8% in September.

The pair edged up 0.11% to 0.7552. Australian grew a better-than-expected 1.3% month-on-month, while grew 0.6% month-on-month, in September. The producer price index grew 1.1% and 2.9% in the third quarter of 2021.

The pair edged down 0.15% to 0.7188. The pair inched down 0.01% to 6.3910 while the pair inched up 0.07% to 1.3798.

The euro was largely flat at $1.16855 after as $1.1692 for the first time since Sep. 28 during the previous session. The handed down its policy decision on Thursday, with comments by President Christine Lagarde interpreted by some as not going far enough in affirming the central bank’s dovish stance.

Lagarde’s “pushback was not forceful enough,” opening the way for the euro to test $1.1680 in the near term, TD Securities strategists said in a note. However, “extrapolating euro strength beyond that seems like a big ask a week ahead of the U.S. Federal Reserve’s meeting where assert tapering will be announced,” the note added.

Foreign exchange markets saw big moves as central banks, including the and the , handed down policy decisions earlier on the week. Meanwhile, the Reserve Bank of Australia on Thursday declined to buy a government bond at the heart of its stimulus program and continued the stance on Friday.

The and the will hand down their policy decisions in the following week. While the Fed is expected to begin asset tapering from November onwards, BOE is expected to announce an interest rate hike.