On the week, the U.S. currency has gained about 1.5 per cent against the yen following comments from Federal Reserve Chair Janet Yellen last August 26 at a central bankers’ gathering in Jackson Hole, Wyoming that revived near-term rate hike prospects. “We have seen no panic from either exchange-traded product investors, where holdings are up on the month, while hedge funds have only reduced net longs by 8 percent from the July peak”.
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Meanwhile, they will keep an eye on a report that is expected to show the consumer confidence index edged slightly down to 97 in August after hitting 97.3 last month.
Meanwhile, France’s pro-business economy minister, Emmanuel Macron, resigned Tuesday from the Socialist government, fueling speculation that he will vie to become the country’s youngest ever president in the 2017 presidential election.
The dollar rose to a three-week high against the yen on Monday after senior Federal Reserve officials bolstered expectations that US interest rates will rise soon.
USA stocks ended Tuesday’s session to the downside as oil prices declined and Wall Street factored in a near-term rate increase.
The dollar index, which tracks the greenback against a basket of six major rivals, added 0.2 percent to 95.714, though it remained shy of the previous session’s high of 95.834 which was its highest since August 12.
Silver rose 1 per cent to $18.77 an ounce. The Nasdaq Composite closed down 9.34 points, or 0.18%, at 5,222.99. Benchmark 10-year US Treasury yields were last at 1.565 per cent, roughly unchanged from late Monday.
According to the most recent data released by the Commerce Department, US consumer spending jumped for the fourth consecutive month in July, supported by strong demand for automobiles.
Fischer said on Friday that an interest rate hike could come in September and that the Fed’s decision would depend on upcoming economic reports including surveys due this week on employment and the manufacturing and service sectors.
Gold held steady on Thursday above two-month lows hit in the previous session after the dollar gave up gains as investors wait for clues to the next USA interest rate hike from the nonfarm payrolls report on Friday.
“If the jobs data is going to be good, gold will fall to $1,260-$1,270 levels as markets will hope for a rate hike in September”.
Oil prices fell for a second straight day on the dollar’s strength and worries about crude oversupply.
Spot gold was little changed at $1,323.26 per ounce at 0116 GMT.
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Brent crude futures settled down 89 cents, or 1.8 percent, at $48.37 per barrel. United States gold futures for December delivery were down $4 an ounce at $1,321.90.
