The dollar was on the front foot on Monday, supported by a strong run of economic data out of the United States that traders bet will keep the Federal Reserve on its monetary policy tightening path for longer than initially expected.
"For the week ahead, the dollar can track higher given the recent run of economic data which supports the narrative of higher-for-longer interest rates," said Carol Kong, a currency strategist at Commonwealth Bank of Australia .have also underpinned the U.S. dollar, as they signalled that interest rates will need to go higher in order to successfully quash inflation.still have some way to rise, pushing up market pricing for the peak ECB rate.
Elsewhere, the U.S. dollar index rose 0.05% to 104.03, and is up nearly 2% for the month so far, keeping it on track for its first monthly gain since last September. The kiwi slipped 0.17% to $0.6232, with eyes on the Reserve Bank of New Zealand's interest rate decision on Wednesday.its tightening campaign only slightly, with a half-point interest rate hike to 4.75%.
"With inflation so high ... not staying the course could mean even higher interest rates are required down the track," said analysts at ANZ.decision on Monday, with markets widely expecting its benchmark lending rates to be kept unchanged at the monthly fixing. "We don't think there will be any changes made," said CBA's Kong. "Our view has been that the government should announce more easing measures to aid the Chinese recovery."Reporting by Rae Wee Editing by Shri Navaratnam
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