Forex - Australian dollar rebounds as USD bulls take a breather

Investing.com - The Australian dollar reversed course on Monday and gained as investors as investors pulled back a bit from recent dollar gains.

On the cards Reserve Bank of Australia Assistant Governor Guy Debelle speaks later in the day.

AUD/USD traded at 0.7642, up 0.09%, while USD/JPY changed hands at 121.33, down 0.05% and EUR/USD was quoted at 1.0516, up 0.19%.

Last week, the U.S. dollar rallied to fresh 12-year highs against the euro on Friday as the diverging monetary policy stance between the Federal Reserve and the European Central Bank pressured the single currency lower.

EUR/USD hit lows of 1.0462, the weakest since Jan. 9, 2003 before pulling back to 1.0496 in late trade, still down 1.31% for the day.

The single currency had already weakened broadly this year after the ECB unveiled a trillion-euro quantitative easing program in January. The euro turned sharply lower after the bank started asset purchases on Monday, pushing euro area bond yields to new lows.

Lower bond yields make the single currency less attractive to investors at a time when expectations are mounting that the Federal Reserve could start rising interest rates mid-year.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was quoted at 100.48, down 0.24%.

In the week ahead, investors will be focusing their attention on Wednesday’s Federal Reserve policy statement to see if it would drop its reference to being patient before raising rates. Central bank

On Monday, Switzerland is to release data on producer prices and retail sales.

In the euro zone, Germany's Bundesbank is to publish its monthly report.

Later Monday Canada is to publish data on foreign securities purchases.

The U.S. is to produce reports on industrial production and manufacturing activity in the New York region, as well as private sector data on the housing market.