Monday, 17 June 2019 15:40 WIB |
The U.S. dollar rose to a two-week high on Monday after strong economic data last week led investors to reassess whether the Federal Reserve will sound as dovish as expected at this week's monetary policy meeting.
Broader currency markets were quiet, as traders hesitated to put on large positions before the Fed meeting, a meeting of European Central Bank policymakers in Portugal and the Bank of England's interest rate decision on Thursday.
Strong U.S. retail sales on Friday reduced the chances of a rate cut this week and lifted the dollar, although Fed Chairman Jerome Powell is expected to leave open the possibility of future rate cuts.
Positioning data point to a scaling back of investors' dollar long positions, although only to levels seen in March.
Expectations of an rate cut at the Fed's June 18-19 meeting fell from 28.3% on Thursday to 21.7% after the retail data, according to CME Group's FedWatch tool. However, bets for monetary easing at the July meeting remain at 85%.
Analysts see plenty of hurdles for the euro, too.
The dollar index, which measures it against a basket of currencies, stood unchanged at 97.569, near a two-week high reached earlier in the session. The euro was little changed at $1.1209.
Source : Reuters