Stability of Dollar before the release of US producer price data

The dollar was little changed against major currencies on Friday as concerns about the performance of the US economy returned, ahead of the release of producer price index data later on Friday and the Federal Reserve meeting to decide on interest rates next week.

Investors are looking forward to a series of interest rate decisions by central banks next week, including the Federal Reserve, the European Central Bank and the Bank of England.

Markets are betting that the three will slow the pace of interest rate hikes by 0.5 percentage point increments, at a time when policymakers continue to push to accelerate growth through monetary tightening to curb soaring inflation.

US data on producer price inflation, due to be released at 1330 GMT, is being watched for signs of a slowdown in interest rate hikes, awaiting the release of consumer price data on Tuesday.

Thursday’s data showed weekly jobless claims rose at a moderate pace, adding to investor jitters about the outlook.

The dollar index, which measures the performance of the US currency against a basket of six major currencies, did not witness much change to settle at 104.780.

The index is still up about 9.5 percent this year so far, but fell more than 6 percent in the fourth quarter, reflecting pessimistic expectations about inflation and interest rates.

And the euro settled against the dollar at $ 1.05555, near the highest level in six months, which it recorded this week, heading for gains for the third consecutive week.

The pound was also little changed on Friday at $1.22460, not far from the six-month high of $1.2345 it reached on Monday when the government unveiled reforms aimed at preserving London as one of the world’s most competitive financial centres.

While the Japanese yen jumped by 0.7 percent, it rose in the latest trading by 0.3 percent to 136.280.