Advertisement

Updated January 11th, 2024 at 12:45 IST

Dollar slips ahead of US inflation data, bitcoin climbs

The weak wage data pulled the yen to a six-week low against the euro.

Business Desk
Dollar
Dollar | Image:Pexels
Advertisement

Dollar slips: The dollar declined in the Asian market on Thursday, as traders awaited US inflation data to assess the validity of predictions for up to five Fed interest rate cuts this year.

Concurrently, weak wage data pulled the yen to a six-week low against the euro.

Advertisement

Bitcoin traded just below a two-year high at $46,400, following the much-anticipated US approval of spot bitcoin exchange-traded funds, driving a 70 per cent increase since mid-October. The Australian and New Zealand dollars each rose approximately 0.3 per cent, with cautious moves ahead of the US data release.

Modest currency gains

The euro and sterling experienced modest gains, while the dollar index fell to 102.23. Despite a recovery, futures suggest the market expects 140 basis points of cuts this year, prompting caution from Rabobank about overly optimistic positions. Rabobank predicts a correction in the outlook, anticipating dollar support over a 1-to-3-month view, with the euro potentially falling to $1.05 amid Germany's economic challenges.

US core inflation for December is projected at 0.3 per cent, marking its slowest rise since early 2021. Analysts note that this reading could reduce the urgency of interest rate cuts. Following Wednesday's sharp gains, the dollar declined 0.3 per cent against the yen.

Advertisement

Japanese workers' real wages shrank for a 20th straight month in November, defying officials' hopes for wage gains before policy tightening. The softer dollar aided China's yuan, rebounding from a one-month low. South Korea's central bank maintained its policy rate for an eighth consecutive meeting, leaving the won marginally stronger at 1,315.8 per dollar.

(with Reuters inputs)

Advertisement

Published January 11th, 2024 at 12:45 IST

Your Voice. Now Direct.

Send us your views, we’ll publish them. This section is moderated.

Advertisement
Advertisement
Whatsapp logo