A number of U.S. Federal Reserve speakers are scheduled to comment this week which could give the market more insight into the Fed's rate path.
Chicago Fed President Charles Evans, speaking on Fox Business Network TV on Monday, said the Fed was likely to lift interest twice more this year, but could be modify its approach to the policy rate depending on inflation. After the "flash crash" in the currency in early-October, the prospect of rising inflation became rather mathematical - and we warned of this by Mr. Mark Carney months-ahead of the Brexit vote when he said a "sharp repricing" in the value of GBP could lead to higher rates of inflation.
Gold dipped on Tuesday as a weaker dollar only partially offset a price retreat seen in Asian trading hours, after a failure to overcome chart resistance prompted speculative selling after a four-day rally. Fed that was less hawkish than many had expected.
- Inflation out of the United Kingdom came-out at 2.3% annualized versus an expectation of 2.1% and a prior read of 1.8%.
They continued lower over the past two days as congressional Republicans have struggled to secure the support necessary for President Donald Trump's proposed health-care overhaul bill to make it out of the House of Representatives.
Interest rates have been at historic lows for the past 10 years so a quarter percent increase isn't too much to worry about.
AARP Mobilizes Against GOP Health Plan
Enrollment in these individual insurance plans was down by about 500,000 people from 2016 by the end of January, it said. In the Senate, a senior Republican said even if the health bill passes the House, "it wouldn't pass the Senate".
Lower yields undermined the greenback's allure, softening the dollar to three-week lows near 112.26 yen in early Asian trade.
Dollar trends and developments surrounding risk appetite will continue to be watched closely in the short term with the French Presidential election TV debate also monitored later on Monday.
"I think three is entirely possible, as I gain more confidence in the outlook I could support three total this year". As of early Tuesday morning, the Singdollar had strengthened by another 0.01 per cent against the U.S. dollar to reach S$1.3963 at 8.40am.
"I think markets are focused on comments made by FOMC members to get a better idea of the path forward for policy and how that will translate for the dollar", said Sireen Harajli, FX strategist at Mizuho in NY.
The dollar index, which measures the greenback against a basket of currencies, was down 0.1 percent to 100.230.
Oil prices fell as investors continued to unwind bets on higher prices because of concerns that growing USA oil output could hamper an Opec-led deal on production reductions.