Investing.com - The dollar was trading close to two-month highs against the yen on Tuesday amid expectations that the Federal Reserve will soon start tapering stimulus, while the pound remained lower after data showed that the annual rate of inflation in the U.K. slowed to the lowest level in more than a year in October.
During U.S. morning trade, USD/JPY rose 0.42% to 99.56, re-approaching the 100 level last hit on September 11.
The dollar remained broadly stronger after last week’s strong U.S. jobs report spurred speculation that the Fed may start winding down its USD85 billion-a-month asset purchase program before the end of the year.
Sterling traded down against the dollar, with GBP/USD sliding 0.36% to 1.5933, after falling as low as 1.5854 earlier.
The drop in the pound came after official data showed that the annual rate of inflation in the U.K. slowed to 2.2% in October, the lowest since September 2012, from 2.7% the previous month. Economists had expected the inflation rate to slow to 2.5%.
The weak data prompted investors to trim back expectations that the Bank of England would raise interest rates sooner than the bank’s forward guidance from August indicated.
The euro recovered from session lows against the dollar, with EUR/USD up 0.30% to 1.3445, but gains looked likely to remain limited amid concerns over weakening demand in the euro zone.
Data released on Tuesday showed that the annual rate of inflation in Germany, the euro zone’s largest economy, slowed to 1.2% in October, the lowest level in more than three years, from 1.4% in September.
The data added to concerns over growing deflationary pressures in the euro area that prompted the European Central Bank to cut rates to a record low 0.25% last week.
Elsewhere, the dollar was lower against the Swiss franc, with USD/CHF down 0.37% to 0.9160.
The greenback was higher against the Australian dollar, with AUD/USD falling 0.47% to 0.9314.
Australia’s dollar came under pressure after the National Australia Bank said its index of business confidence pulled back from three-and-a-half year highs in October amid concerns over the tepid outlook for domestic demand.
The greenback pushed higher against the New Zealand and Canadian dollars, with NZD/USD losing 0.21% to trade at 0.8236 and USD/CAD climbing 0.16% to 1.0490.
The U.S. dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, inched up 0.02% to 81.17.
During U.S. morning trade, USD/JPY rose 0.42% to 99.56, re-approaching the 100 level last hit on September 11.
The dollar remained broadly stronger after last week’s strong U.S. jobs report spurred speculation that the Fed may start winding down its USD85 billion-a-month asset purchase program before the end of the year.
Sterling traded down against the dollar, with GBP/USD sliding 0.36% to 1.5933, after falling as low as 1.5854 earlier.
The drop in the pound came after official data showed that the annual rate of inflation in the U.K. slowed to 2.2% in October, the lowest since September 2012, from 2.7% the previous month. Economists had expected the inflation rate to slow to 2.5%.
The weak data prompted investors to trim back expectations that the Bank of England would raise interest rates sooner than the bank’s forward guidance from August indicated.
The euro recovered from session lows against the dollar, with EUR/USD up 0.30% to 1.3445, but gains looked likely to remain limited amid concerns over weakening demand in the euro zone.
Data released on Tuesday showed that the annual rate of inflation in Germany, the euro zone’s largest economy, slowed to 1.2% in October, the lowest level in more than three years, from 1.4% in September.
The data added to concerns over growing deflationary pressures in the euro area that prompted the European Central Bank to cut rates to a record low 0.25% last week.
Elsewhere, the dollar was lower against the Swiss franc, with USD/CHF down 0.37% to 0.9160.
The greenback was higher against the Australian dollar, with AUD/USD falling 0.47% to 0.9314.
Australia’s dollar came under pressure after the National Australia Bank said its index of business confidence pulled back from three-and-a-half year highs in October amid concerns over the tepid outlook for domestic demand.
The greenback pushed higher against the New Zealand and Canadian dollars, with NZD/USD losing 0.21% to trade at 0.8236 and USD/CAD climbing 0.16% to 1.0490.
The U.S. dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, inched up 0.02% to 81.17.