Buying from the
start of European trade on Monday halted three days of losses for the
dollar, the impact of higher U.S. market interest rates turning it
positive on the day against both the euro EUR= and a basket of currencies. .DXY
A
wave of profit-taking on some of the greenback's gains of the past
fortnight has been encouraged since Thursday by signs the European
Central Bank is beginning to think more about how to react to an
improving euro zone economy.
Some ECB policymakers last week raised the possibility of increasing interest rates before it ends its emergency asset purchases although the discussion was isolated and did not enjoy any broad support, sources said on Friday.
Friday's solid jobs number has still cemented the case for a rise in U.S. Federal Reserve rates this week that will long predate any European move and sees market rates far higher.
Belgian central banker Jan Smets also told the Wall Street Journal that the ECB had not taken a first step toward removing stimulus.
By 0840, the dollar had recovered around a third of a cent from lows hit in Asian time to stand flat on the day at $1.0680. The dollar index was marginally higher at 101.26.
Fed fund futures prices showed investors pricing in more than a 90 percent chance of an increase in U.S. overnight interest rates and the market's attention is now firmly on the scale of tightening further out.
Money market pricing still stops short of three quarter-point rises this year. If the Fed can continue to move every three months, it will deliver four.
Some ECB policymakers last week raised the possibility of increasing interest rates before it ends its emergency asset purchases although the discussion was isolated and did not enjoy any broad support, sources said on Friday.
Friday's solid jobs number has still cemented the case for a rise in U.S. Federal Reserve rates this week that will long predate any European move and sees market rates far higher.
Belgian central banker Jan Smets also told the Wall Street Journal that the ECB had not taken a first step toward removing stimulus.
By 0840, the dollar had recovered around a third of a cent from lows hit in Asian time to stand flat on the day at $1.0680. The dollar index was marginally higher at 101.26.
Fed fund futures prices showed investors pricing in more than a 90 percent chance of an increase in U.S. overnight interest rates and the market's attention is now firmly on the scale of tightening further out.
Money market pricing still stops short of three quarter-point rises this year. If the Fed can continue to move every three months, it will deliver four.
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