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Dollar stuck near 5-month low as caution reigns ahead of U.S. CPI, ECB tests By Reuters

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© Reuters. FILE PHOTO: US dollar banknotes are seen on a desk at an exchange office in Karachi, Pakistan, December 3, 2018. REUTERS / Akhtar Soomro By Kevin Buckland TOKYO (Reuters) – The dollar continued to hover near a five-month low versus major peers on Thursday as investors looked at key US inflation data and a European Central Bank meeting later in the day to possibly see that Provide direction for the foreign exchange markets. Investors have been on a wait-and-see stance all week, sucking the volatility out of the market and largely keeping major currencies in a range. It fluctuated around the psychologically important 90 mark and was most recently at 90.137. The euro climbed to a one-week high of $ 1.2218 on Wednesday, only to end slightly unchanged, and was largely unchanged in Asia at $ 1.2178. The yen was trading at 109.62 per dollar, also little changed since Wednesday and near the middle of the 109.19 to 110.325 range for the past two weeks. Deutsche Bank’s (DE 🙂 currency volatility index remained at its lowest level since February 2020. US Department of Labor consumer price data was eagerly awaited after last month’s report showed that consumer prices rose so sharply in April for nearly 12 years . This has fueled bets that higher prices could last longer than some anticipate, potentially calling into question the Federal Reserve’s insistence that current inflationary pressures are temporary and that monetary stimulus should continue for some time. Economists polled by Reuters estimate that the CPI rose 0.4% in May. While the greenback held tight ranges in the run-up to the report, benchmark 10-year government bond yields – which helped push the dollar index to multi-year highs earlier this year – fell a sizable step over the past week and was 1.4874% in Asia, down from 1.6350% on Friday. “It feels like the risk balance in the US CPI is sloping up from the consensus, which would favor a sell-off in Treasuries – (and therefore) higher yields – and then a stronger USD,” Chris Weston, Head of Research head at brokerage firm Pepperstone in Melbourne, in a notice to clients. “Bonds seem overbought.” At the ECB, investors will be on the lookout for any signs of an impending slowdown in their bond-buying program. While the ECB is widely expected to keep its monetary policy stance stable, the euro may be sensitive to changes in the bank’s economic outlook or signals that the pace of bond purchases may be slowed in the coming months. In the crypto markets, Bitcoin posted gains from its biggest rally in four months on Wednesday, when it rose nearly 12%. Most recently, it was barely changed at $ 37,097.02 after rebounding from a three-week low of $ 31,025 on Tuesday as signs of institutional caution and regulatory scrutiny drove the sell. ================================================ == ==== Currency bid rates at 0049 GMT Description RIC Last US closing price Point change YTD Point highest bid Low bid Previous change session Euro / Dollar $ 1.2175 $ 1.2179 -0.02% -0.34% +1.2181 +1.2176 dollars / Yen 109.5900 109.6450 -0.03% + 6.12% +109.6750 +109.6150 Euro / Yen 133.43 133.53 -0.07% + 5.13% +133.5500 +133.4300 dollars / Switzerland 0.8961 0.8960 + 0.01% + 1.28% +0.8962 +0.8958 pounds sterling / Dollar 1.4111 1.4114 + 0.00% + 3.30% + 1.4115 +1.4110 dollar / Canadian 1.2119 1.2110 + 0.09% -4.82% +1.2119 +1.2108 Aussie / dollar 0.7724 0.7731 -0.08% + 0.42% +0.7731 +0.7724 NZ dollar / dollar 0.7168 0.7178 -0.13% -0.18% +0.7178 +0.7168 All Spots Tokyo Spots Europe Spots Volatilities Tokyo Forex Market Information from BOJ

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