Dollar is stable ahead of a busy week of data and yen is under pressure

The dollar fell on Tuesday, after a strong rally, amid dealers’ reluctance to make big bets ahead of a series of expected economic data this week, while the Japanese yen fell to close to the levels that led the authorities to intervene to support it last year.

The dollar fell against a basket of major currencies 0.06% to 103.88, after declining 0.2% on Monday.

The dollar index has risen 2 percent this month and posted six weeks of gains after strong US economic data reinforced expectations that interest rates may remain high for longer.

Those expectations gained more momentum after Federal Reserve Chairman Jerome Powell indicated on Friday that more rate hikes may be needed to rein in still-very high inflation, but his pledge to move cautiously in upcoming meetings sparked some uncertainty. certainty.

Personal consumption expenditures, the Fed’s preferred measure of inflation, are due on Thursday and non-farm payrolls data on Friday.

The euro rose 0.1 percent to $1.0828. The pound sterling also rose in the latest trading to 1.262 dollars, and increased during the day 0.17 percent, moving away from its lowest level in two months, which it recorded last week.

The widening gap in interest rates between Japan and the United States put pressure on the yen, as low interest rates made the country’s currency an easy target for short sellers and suitable for financing deals.

The yen was little changed at 146.4 per dollar on Tuesday, but remains close to 146.75, its lowest level since November 9, which it hit the previous day. The Asian currency has fallen about 11 percent against the dollar during the year.

Dealers are watching for any signs of intervention from the Japanese authorities.

Japan intervened in the currency markets last September when the dollar rose above 145 yen, as the Ministry of Finance bought the yen, bringing the exchange rate to about 140 yen to the dollar.