New York, US (BBN)- The dollar gained in Asia on Thursday after inflation data from China came in lower than expected with the focus on a near solid expectation the Fed will hike rates next week with US jobs data at the end of the week still key.
The US dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, rose 0.01 per cent to 102.12, reports Investing.com.
USD/JPY changed hands AT 114.44, up 0.09 per cent, while AUD/USD traded at 0.7520, down 0.11 per cent.
Consumer prices in China fell to the lowest in two years at an annual pace of 0.8 per cent, the National Bureau of Statistics said on Thursday, which compared to a gain of 1.7 per cent expected as food prices dropped, and eased pressure after a 2.5 per cent gain in January.
On a month-over-month basis, CPI fell 0.2 per cent in February from a month earlier.
Producer prices rose for the sixth straight month in February from a year earlier, up 7.8 per cent.
The People's Bank of China set the yuan mid-point at 6.9125 against the dollar on Thursday, compared with the previous close of 6.9135. USD/CNY opened at 6.9131.
Overnight, the dollar rose against a basket of major currencies on Wednesday, after a bullish ADP jobs report boosted expectations of a March rate hike to its highest level.
ADP and Moody’s analytics said Wednesday, employment in the private sector climbed by 298,000 for the month, which dwarfed economists’ expectations of 190,000.
The bullish ADP report boosted expectations the Federal Reserve will increase interest rates at its next meeting in March and lifted optimism for a better than expected Non-Farm Payrolls print on Friday.
According to Investing.com’s Fed rate monitor tool, nearly 90 per cent of traders expect a rate hike in March, compared to just under 80 per cent last week.
Meanwhile, sterling fell to its lowest level since January, after Chancellor Philip Hammond revealed Britain's first full budget since the Brexit vote and raised Britain’s economic growth forecast for 2017 but lowered it for the following three years.
BBN/SK/AD