Dollar flat after hitting one-month peak

Dollar flat after hitting one-month peak

The dollar was flat on Wednesday as investors took profits after it reached a one-month high early in the session versus a group of currencies as U.S. data showed robust growth in retail sales and consumer prices in January.

The greenback was on track for its 11th straight day of gains, then retreated as U.S. Federal Reserve Chair Janet Yellen, in her second day of economic testimony before Congress,
offered no additional insight on the timing of the central bank's next rate hike.

On Tuesday, Yellen hinted more rate increases were on the way as the jobs market has improved and inflation has shown signs of nearing the Fed's 2 percent goal. 

She cautioned the number of rate hikes partly hinges on the impact from possible tax cuts, infrastrucuture spending and looser regulaton from U.S. President Donald Trump and the
Republican-controlled Congress. 
   

The dollar index, which measures the currency against its six major peers, was flat at 101.19. It had rallied to a session high of 101.76, its highest since Jan. 12 as data showed a stronger-than-forecast 0.4 percent increase in retail sales in January and a 0.6 percent jump in consumer prices last month, their biggest gain in nearly four years. 
 
The futures market implied traders have priced in only a 27 percent chance of a rate increase at the Fed's March 14-15 policy meeting and less than a 50 percent chance the Fed
would raise rates three times in 2017.

Not all U.S. data were encouraging with industrial output and a gauge on home builder sentiment taking unexpected spills.

The euro rebounded from an one-month low against the greenback, last up 0.1 percent at $1.0587, while the dollar hovered near a two-week high versus the yen, last at 114.26 yen. (Reuters)

Source: www.businessworld.ie