The British pound rose and the dollar fell as traders awaited new economic signals

The pound sterling rose to its highest level in more than two months against the dollar on Monday, although some risk aversion limited the US currency’s losses, with traders awaiting new economic signals next week to determine the course of monetary policy regarding future interest rates.

The current week is full of events, such as the postponed OPEC+ meeting, the release of data from the Federal Reserve’s preferred inflation index, as well as inflation readings in the euro zone and Australia, the Reserve Bank of New Zealand’s decision on interest rates, and the release of Chinese Purchasing Managers’ Index data.

The pound sterling rose to its highest level in more than two months to $1.2620, extending last week’s gains after data showed that British companies unexpectedly announced a marginal return to growth in November after three months of contraction.

The pound sterling is heading towards achieving gains of about 3.8 percent during the month, which is its largest monthly increase in a year.

Regarding other currencies, the dollar fell 0.32 percent to 148.97 yen, while the euro rose 0.2 percent to $1.0952.

The dollar index fell 0.12 percent to 103.31 points and is heading towards a monthly loss of more than three percent, recording its worst performance in a year.

Traders returning from the Thanksgiving holiday late last week are still anticipating interest rates peaking and have turned their attention to when the first rate cut could take place, and the US PCE price index this week is likely to provide further evidence of the steps. Following the Federal Reserve.

According to the CME Group’s FeedWatch tool, approximately 23 percent of market participants expect the Federal Reserve to begin easing monetary policy starting next March.

The Australian dollar gave up some of its losses throughout the day and fell in recent transactions by 0.03 percent to $0.6583. It had risen earlier in the session to its highest level in more than three months at $0.6595.

The New Zealand dollar fell 0.13 percent to $0.6074.

The yuan fell after gains over five consecutive sessions, and recorded in the latest trading inside China 7.1550 against the dollar.

The yuan outside China fell approximately 0.2 percent to 7.16 against the dollar.