US Dollar Rises Against Almost All Majors On Monday
Dollar advanced against a basket of major currencies on Monday, as investors weighed the prospect of a March rate hike while the euro sunk more than 0.4% amid uncertainty over the outcome of the French presidential elections.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, climbed 0.35% to 101.70, after hitting a session low of 101.23.
Despite the lack of top-tier economic data, market moves in the greenback continue to increase expectations that the Federal Reserve will increase interest rates at its next meeting on March 14-15.
Federal Reserve Chair Janet Yellen is expecting an increase in interest rates this year and hinted that should U.S. economic data come in as expected, then monetary tightening “would likely be appropriate” at the Fed’s policy meeting in March.
According to Investing.com’s Fed rate monitor tool, nearly 90% of traders expect a rate hike in March, compared to just under 80% last Friday.
Meanwhile, uncertainty concerning the outcome of the French presidential elections weighed on the euro, after former French Prime Minister Alain Juppe, announced Monday he would not seek the country’s presidency. This is viewed as a boon for anti-European candidate Marine Le Pen.
EUR/USD lost 0.38% trade at $1.0581,session`s low of $1.0577 while EUR/GBP gained 0.22% to 0.8651.
Elsewhere, GBP/USD declined 0.61% to $1.2230 while the USD/CAD added 0.33% to $1.3418.
The dollar traded lower against the yen with USD/JPY down 0.06% to 113.98, as investors poured into the safe haven yen, after North Korea conducted missile tests, which lessened appetite for risk.