The dollar treaded water on Tuesday as investors braced for an highly anticipated inflation report, while the yen strengthened ahead of the expected announcement of surprise pick Kazuo Ueda as the next Bank of Japan governor.
Markets are looking to the U.S. consumer price index (CPI) data for further clues on Federal Reserve's policy outlook, with the headline number expected to rise 0.5% in January, according to a Reuters poll, after falling 0.1% in December.
The dollar treaded water on Tuesday as investors braced for an highly anticipated inflation report, while the yen strengthened ahead of the expected announcement of surprise pick Kazuo Ueda as the next Bank of Japan governor.
Markets are looking to the U.S. consumer price index (CPI) data for further clues on Federal Reserve's policy outlook, with the headline number expected to rise 0.5% in January, according to a Reuters poll, after falling 0.1% in December.
Clifton said services inflation, which is strongly linked to wages growth, has shown no signs of softening, adding that a cooling in the labour market will be required for that to occur.
"While the labour market remains tight and wages growth very strong there is the risk that we receive upside surprises on the underlying inflation figures," she said.
The Federal Reserve earlier this month raised interest rates by 25 basis points but said that it was turning the corner in its fight against inflation.
The euro was up 0.1% to $1.0731, having risen 0.435% the previous session. Sterling <GBP= D3> was last trading at $1.2149, up 0.12% on the day, after rising 0.6%.
The Australian dollar added 0.04% to $0.697, while the kiwi rose 0.25% to $0.637.
Sources: reuters