LONDON Reuters The safe haven dollar ticked up against most currencies on Monday as concerns about the pandemic made investors cautious, while they also awaited more clues about the global economic recovery before making their next moves.
With markets hypersensitive to any talk of early tapering, U.S. inflation data on Tuesday will be closely watched ahead of testimony by Federal Reserve Chair Jerome Powell on Wednesday and Thursday.
Meanwhile, the Peoples Bank of Chinas surprise policy easing on Friday, meant to boost the postCOVID economic recovery, failed to provide lasting momentum.
While welcome, the move also signals that the authorities are concerned about Chinas growth prospects, so its mixed news, said Marshall Gittler, head of investment research at BDSwiss Holding.
The yuan was just slightly lower at 6.4750 per dollar after Chinese shares and bonds rose. CNY.SS
Economists polled by Reuters expect U.S. consumer prices for June to have risen 0.4 from May, and 4.0 from a year earlier, after two straight months of sharp gains.
Any signs that inflation could be more persistent than previously thought could fan expectations the Fed may exit from current pandemicera stimulus earlier, supporting the dollar against other major currencies.
Conversely, more benign data could lead investors to think the U.S. central bank can afford to maintain an easy policy framework for longer, encouraging more bets on risk assets, including risksensitive currencies.