The dollar remained steady in early trade on Tuesday, with the yen retreating from one-month highs as investors await U.S. inflation data and rethink expectations for a big interest rate cut from the Federal Reserve beginning next week.
A mixed labour report released on Friday failed to make a clear argument for whether the Fed will decrease interest rates by 25 basis points (bps) or 50 bps at its decision meeting on September 17-18.
Traders are now looking forward to Wednesday’s consumer price index report in the United States for more policy hints, despite the fact that the Fed has stated that employment has taken precedence over inflation.
According to a Reuters survey, the headline CPI is predicted to grow 0.2% month on month in August, matching the previous month’s rate.
Investors will also be focused on the highly anticipated televised US Presidential debate later on Tuesday, which might have a significant impact on the November election.
The dollar rose 0.1% to 143.30 yen, moving away from the one-month low of 141.75 reached on Friday. Sterling recently traded at $1.3061, having hit a nearly three-week low of $1.3058 earlier in the session.
The dollar index, which compares the US currency to six rivals, was at 101.69 after increasing 0.4% on Monday. The index dropped 0.5% last week as traders’ expectations for rate cuts altered.
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