The dollar is gaining ground against all of its major rivals Monday afternoon. The lack of U.S. economic data kept some investors on the sidelines at the start of the week, but some hawkish comments from New York Fed President William Dudley has sparked a rise in the dollar.
Dudley said that inflation is little lower than the Fed’s target but it would rise along with a pickup in wage growth, enabling the central bank to continue the tightening cycle.
“We are pretty close to full employment. Inflation is a little lower than what we would like, but we think that if the labor market continues to tighten, wages will gradually pick up and with that, inflation will gradually get back to 2 percent,” Dudley said at a speech to chamber of commerce in Plattsburg, New York.
French President Emmanuel Macron’s party won a clear parliamentary majority in Sunday’s election, giving him a strong mandate in parliament to pursue his pro-European Union, business-friendly reform plans.
The dollar has climbed to around $1.1145 against the Euro Monday afternoon, from an early low of $1.1212.
Eurozone construction output recovered in April after declining in March, data from Eurostat showed Monday. Construction output rose 0.3 percent month-on-month in April, reversing a 1.1 percent fall in March.
The job vacancy rate in the euro area increased in the first quarter, figures from Eurostat showed Monday. The job vacancy rate rose to 1.9 percent in the first quarter from 1.7 percent in the previous period.
Brexit negotiations are set to begin today, after Britain bowed to pressure for a formal opening to their long-awaited negotiations rather than first holding technical talks between civil servants. U.K. Brexit Secretary David Davis, along with others will begin talks with the Chief EU negotiator Michael Barnier in Brussels to discuss Britain’s exit from the European Union.
The buck has advanced to around $1.2730 against the pound sterling this afternoon, from an early low of $1.2814.
British households’ finance outlook worsened further in June and their financial pressures remained sharp on higher living costs, results of a survey by IHS Markit and financial information provider Ipsos Mori revealed Monday. The seasonally adjusted Household Finance Index, or HFI, rose to 43.8 in June from 42.6 in May.
The average asking price for a house in the United Kingdom was down 0.4 percent on month in June, property tracking website Rightmove said on Monday, coming in at 316,109 pounds. That follows the 1.2 percent increase in May.
The International Monetary Fund advised Japan to continue fiscal stimulus as growth is likely to weaken in 2018.
The lender cautioned that the expiration of fiscal support in 2018 under current policies together with a smaller expansion in foreign demand would reduce growth to less than half of that in 2017.
Without additional spending, the fiscal stance could become contractionary in 2018-20 due also to the scheduled consumption tax hike in October 2019, IMF staff said concluding the Article IV consultation.
The greenback has broken out to a 2-week high of Y111.490 against the Japanese Yen this afternoon, from a low of Y110.907 this morning.
Japan posted a merchandise trade deficit of 203.367 billion yen in May, the Ministry of Finance said on Monday. That missed forecasts for a surplus of 43.3 billion yen following the 481.1 billion yen surplus in April.
The material has been provided by InstaForex Company – www.instaforex.com