NEW YORK: The dollar fell on Friday as oil prices eased, but was poised for a second straight weekly advance on growing rate hike bets, while the yen rallied after Japan said Tokyo and Washington remain committed to the stance behind July’s joint intervention.
The dollar was on track to snap a four-day streak of gains as crude prices fell more than 1 percent.
Global oil prices have eased as the potential for a truce between the US and Iran outweighed supply concerns from increasing attacks by Houthi fighters against Saudi Arabia. Still they remain above USD100 a barrel, maintaining upward pressure on inflation.
Comments from central bank officials flagging inflation concerns and support for more rate increases after last week’s rate hike of 25 basis points have boosted market expectations for a more aggressive path of monetary policy and helped spark a jump in US Treasury yields.
“We’ve had like a pretty aggressive rally in the dollar over the last couple of days and maybe it’s a little stretched, just taking a little breather. So I wouldn’t really say that the dollar is really weakening materially today,” said Eugene Epstein, head of trading and structured products at Moneycorp in Stamford, Connecticut.
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