The dollar added 0.4 percent to 102.24 yen after earlier rising as high as 102.28, its strongest since August 12.The euro was flat at $1.1202, while the dollar index, which tracks the greenback against a basket of six rivals, was down slightly on the day at 95.519 .dxy .
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The S&P 500 financial index was last up 1.2 per cent, with Wells Fargo gaining two per cent and JPMorgan rising more than one per cent. However, reading above 200,000 could make a strong case for higher interest rates in the near term.
On the economic front, the Conference Board Consumer Confidence Index came in at 101.1 in August, up from 96.7 in July.
Selling pressures faded in the afternoon as the USA dollar came off its daily highs to trade flat against a basket of world currencies. In that context, short-term Treasurys, which are most sensitive to changes in the Fed-funds rate, would be most vulnerable to a potential selloff and soaring yields if Friday’s official jobs report beats expectations, he added. “A pickup in consumer spending, on durables especially this time around, gives the Fed another little push”.
Last Friday, Stanley Fischer, vice-chairman of the Federal Reserve, surprised markets with comments that were more hawkish than his boss, Janet Yellen, had given just hours before at the Fed’s Jackson Hole Symposium. The yield on Germany’s benchmark 10-year bond briefly rose more than 6 basis points to minus 0.025 percent – the highest level since June 24, when the result of Britain’s European Union referendum sent shockwaves through markets.
The Dow Jones industrial average closed down 48.69 points, or 0.26 percent, at 18,454.3.
The WSJ Dollar Index was recently up 0.5% at 86.91. “However, it’s unlikely we will see gold move outside of $1,300”. Platinum was 0.7% lower at $1,062.99, while palladium was down 1.4% at $686. U.S. 30-year Treasury bond yields also fell, with their prices rising more than a full point. “This is not the kind of news that the equity traders are going to cheer and hence we are seeing this kind of reaction in the market”, said Naeem Aslam, chief market analyst at ThinkMarkets, in a note.
The unemployment rate has hovered near 5% for the past year, he noted last week.
West Texas Intermediate fell 1.3 percent to $47.04 and Brent shed 1.2 percent to $49.30. Yellen noted that the U.S. economy is improving and suggested the case for a move on rates had strengthened in recent months.
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Safe-haven spot gold slid to a near five-week low of $1,314.70 on the dollar’s gains.
