Early Monday trade saw the US dollar climb to its highest level in two weeks against the euro as expectations on a significant route of monetary easing in the United States dropped.
This coincides with traders waiting for the US employment report to be published this week.
Supported by a rise in long-term US Treasury bond rates to their highest levels since mid-August following data showing no notable drop in inflation, the dollar climbed to its highest level since August 21 against the yen, so lowering the likelihood that the Federal Reserve (the US central bank) would cut interest rates by 50 basis points on September 18.
Whereas traders now anticipate a 67 percent possibility of a 25-point decrease, they have a 33 percent chance the Fed will drop rates by 50 basis points in September. Traders were 36 percent likely to lower rates one week ago.
Reuters data shows the dollar increased almost 0.27 percent to 146.60 yen before declining to 146.04 yen in morning trading by 0510 GMT.
Beginning trade in Asia, the dollar index versus six major currencies climbed to 101.79 points—a level not seen since August 20.
In the most recent trading, the index tallied 101.72 points.
Before trading at $1.1046, the euro dropped to $1.1042, its lowest level since August 19.
A public holiday on Monday in the United States influences the value of the dollar, according to analysts; but, the next few days will see the publication of a range of economic statistics, including Friday non-farm payroll data.
A holiday will cause U.S. Treasuries to not trade on Monday; nonetheless, the yield on the 10-year note was 3.9110 percent following 4.4 basis point increase on Friday.
Steady at $1.31255, the pound moved close to Friday’s low of $1.31095, its weakest since Aug. 23.
