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Dollar Up, but Near Two-Week Lows as Fed Taper Uncertainty Continues

Published 08/30/2021, 10:32 PM
Updated 08/30/2021, 10:36 PM
© Reuters.
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By Gina Lee

Investing.com – The dollar was up on Tuesday morning in Asia but remained near two-week lows. Moves were mostly light as August draws to a close, with the latest U.S. jobs report, including non-farm payroll numbers, due later in the week.

The U.S. Dollar Index that tracks the greenback against a basket of other currencies inched up 0.01% to 92.662 by 10:28 PM ET (2:28 AM GMT).

The USD/JPY pair inched down 0.05% to 109.87.

The AUD/USD pair inched down 0.01% to 0.7293, after peaking at $0.7317 last Friday. The NZD/USD pair was up 0.38% to 0.7025.

The USD/CNY pair inched up 0.04% to 6.4684. China released lower-than-expected economic data earlier in the day, with the manufacturing purchasing managers’ index (PMI) at 50.1 and the non-manufacturing PMI at 47.5 in August. The offshore Chinese yuan remained close to its three-week high of 6.4595 hit on Friday.

The GBP/USD pair inched up 0.05% to 1.3765.

The greenback clawed back some of its losses after U.S. Federal Reserve Chairman Jerome Powell did not provide a firm timetable for asset tapering to begin beyond hinting that it could begin within 2021.

"The jobs report, due on Friday, will be the next highlight given the focus on the Fed's asset taper. A strong reading will boost expectations that the Fed will give markets prior notice in September before a formal decision in November," Daiwa Securities senior strategist Yukio Ishizuki told Reuters.

However, numbers that are lower than expected could delay the notice to November with the formal decision following a month later.

In Europe, the consumer price index for August is due later in the day. The euro traded at $1.1799, near Monday's three-week high of $1.1810, earlier in the Asian session.

Meanwhile, the Canadian dollar was at CAD1.2610, after hitting a two-week high on Monday as strong oil prices led to a wider-than-expected Canadian current account. Oil prices, in turn, climbed to three-week highs, with re-start timelines for platforms, refineries and pipelines in the U.S. Gulf Coast remaining uncertain after Hurricane Ida blew through the region over the weekend.

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