Forex – Dollar flat, sterling higher in holiday-thinned trade

The dollar was little changed against a basket of the other major currencies on Monday, holding above last week’s six-and-a-half month lows as markets shrugged off news of North Korea’s latest missile test.

Trade volumes remained thin with financial markets in the UK and the U.S. closed for holidays.

Investors were looking ahead to Friday’s U.S. employment report, which was expected to show that conditions in the labor market remain solid.

A strong U.S. jobs report would cement expectations for a rate hike by the Federal Reserve at its next meeting in June.

Data on Friday showed that the U.S. economy slowed less than initially thought in the first three months of the year. Gross domestic product grew at an annual rate of 1.2% in the three months to March, the Commerce Department said, up from an initial estimate of 0.7%.

The dollar was steady against the safe haven yen, with USD/JPY at 111.33.

The yen showed little reaction after North Korea fired what appeared to be a short-range ballistic missile early on Monday.

Investors remained in a cautious mood amid ongoing political concerns surrounding the Trump administration.

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