Dollar gains against yen as traders see Dec. Fed rate hike
- Nasdaq hits record; bank earnings validate Wall St. rally
- Intrawest Resorts (SNOW) Exploring a Possible Sale - Reuters
- Alibaba (BABA) Has No Plans to Acquire Rest of Groupon (GRPN) - Source
- Time (TIME) Said to Soon Begin Discussions with Interested Buyers - Bloomberg
- JPMorgan (JPM) Reports Q4 EPS of $1.71
Euro and Dollar banknotes are seen in a picture illustration taken October 19, 2016. REUTERS/Leonhard Foeger
Get inside Wall Street with StreetInsider Premium. Claim your 2-week free trial here.
By Sam Forgione
NEW YORK (Reuters) - The U.S. dollar hovered near a nine-month high against a basket of major currencies and touched a one-week high against the yen on Monday on growing expectations of a Federal Reserve interest rate increase in December.
Recent positive economic data and comments from central bank officials have bolstered those expectations, with traders on Monday seeing a roughly 74 percent chance that the Fed will raise rates in December, according to data from CME Group's FedWatch program.
The Fed could appropriately raise rates three times between now and the end of 2017, Chicago Fed President Charles Evans said on Monday, so long as inflation expectations and the labor market continue to improve.
Evans' comments built on remarks by San Francisco Fed President John Williams on Friday and New York Fed President William Dudley on Oct. 19, both of whom hinted at a nearing rate increase.
Preliminary Markit data on Monday showing U.S. manufacturing reached a one-year high this month reassured traders after a reading last week showed U.S. home resales in September beat expectations.
The dollar index <.DXY>, which measures the greenback against a basket of six major currencies, was up slightly at 98.775 <.DXY>, just off a roughly nine-month high of 98.846 touched earlier on Monday.
In morning U.S. trading, the dollar rose to 104.32 yen
"Even the most dovish comments seem to include a December rate hike, so that’s almost a near reality coming up," said Alfonso Esparza, senior currency strategist at Oanda in Toronto.
The dollar slipped against emerging market currencies. Analysts attributed that to greater appetite for risk and recent polling that shows Hilary Clinton leading Donald Trump two weeks before the Nov. 8 U.S. presidential election.
Trump's stance on protectionist trade measures has been seen as a risk to emerging market currencies.
"To the extent that the election matters for the dollar, that’s an indication of markets pricing in less Trump risk," said Greg Anderson, global head of foreign exchange strategy at BMO Capital Markets in New York.
The dollar was last down slightly at 18.56 Mexican pesos
(Reporting by Sam Forgione; Editing by Lisa Von Ahn and Steve Orlofsky)
Serious News for Serious Traders! Try StreetInsider.com Premium Free!
You May Also Be Interested In
- ECB to hold steady, Trump takes office
- Spain arrests Moroccan accused of leading Islamist militant cell
- BOJ offers brighter view on regional Japan economies
Create E-mail Alert Related CategoriesForex, Reuters
Related EntitiesDonald J. Trump, BMO Capital, William Dudley
Sign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!