The euro continued to slip against the dollar for the second straight day
The dollar traded higher against a basket of major currencies on Tuesday, buoyed by an uptick in expectations that the Federal Reserve is poised to increase its benchmark rate in June.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, rose by 0.45% to 99.48 by 12:53 EDT.
The dollar is on track for a two-day win streak as investors’ expectations for a June rate hike soared to the highest level on Tuesday amid slew of comments from Federal Reserve officials.
Investors mulled over hawkish comments from Kansas City Fed President Esther George on Tuesday. George said that the U.S. central bank should keep gradually raising short-term interest rates despite the recent slowdown in GDP and car sales.
Euro vs USD today
U.S. Treasury yields continued to climb on rate hike expectations; the U.S. 10-Year hit a five-week high of 2.409, up 1.37%.
According to investing.com’s Fed rate monitor tool, 80% of traders expect the Federal Reserve to hike interest rates in June, compared to 63% in the previous week.
Investors looked ahead to comments from Fed officials’ Eric S. Rosengren and Robert Kaplan, as both are expected to make a public appearance later today at 13:00 EDT.
Meanwhile, the EUR/USD slipped to $1.0876, down 0.44%, while EUR/GBP fell 0.41% to 0.8405, as investors continued to take profit in the single currency, following centrist Emmanuel Macron’s victory over Marine Le Pen on Sunday.
GBP/USD traded flat at $1.2938, as investors considered the impact of newly elected French president Emmanuel Macron’s plans to introduce a “Buy European Act”, which would block companies from outside the European trading bloc from bidding for public contracts within the European Union.
Demand for safe-haven yen continued to drop amid an uptick in sentiment towards riskier assets. USD/JPY traded at 114.22, up 0.86%.