The dollar was little changed on Monday versus a basket of currencies, holding near a 14-year peak buttressed by expectations of fiscal stimulus from US President-elect Donald Trump and a faster pace of interest rate increases. The greenback scaled back from its highest since early February against the yen as data that showed Japan's export performance improved strongly in November spurred a burst of profit-taking.
The dollar, which has rallied since Trump's win on November 8, will likely trade in a tight range in coming days on dwindling liquidity, analysts said. Profit-taking and lower US Treasury yields would keep the greenback from rising further, they said. "The dollar would be reasonably sideways between now and the end of the year," said Jason Weinwand, founder and chief executive officer of FirstLine FX in Randolph, New Jersey.
The dollar index which measures the greenback versus the euro, yen and four other currencies, was up 0.03 percent at 102.98. On December 15, it reached 103.56 which was its highest since December 2002. Traders await a speech from Fed Chair Janet Yellen at 1:30 pm (1830 GMT) for possible hints that last week's Fed meeting, where policy-makers signalled the central bank could increase interest rates three times in 2017, was interpreted by markets as more hawkish than had been intended. The dollar was down almost 0.9 pecent at 117.13 yen after climbing to 118.66 yen on December 15 which was the highest since February 2, according to Reuters data showed.
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