At 03:05 ET (08:05 GMT), the Dollar Index, which follows the dollar versus a basket of six other currencies, increased 0.2% to 104.695.
The U.S. CB ends its two-day conference on Wednesday. It should slow down the pace of its monetary tightening to fight inflation at historic levels by raising interest rates by 50 bps rather than the 75 bps of its last four meetings.
On Sunday, U.S. Treasury Secretary Janet Yellen indicated a substantial decline in U.S. inflation in 2023. Nevertheless, data on Friday revealed U.S. producer prices had increased more than expected last month, suggesting persistent inflationary pressures and a chance the Fed will maintain rates higher for longer.
November’s U.S. consumer inflation figures will become public Tuesday, ahead of the Fed’s final reviews. They should show the headline annual figure dropping to 7.3% while the core annual inflation is dropping to 6.1%.
Other Currencies
EUR/USD traded largely even at 1.0530, with the European Central Bank also committed to delivering a 50 bps hike later this week after two straight 75 bps increases, delaying the pace of tightening.
Headline inflation in the Eurozone was restricted in November for the first time in 18 months, raising longings that sky-high price growth has expired.
However, at 10%, this level is five times the ECB’s inflation target, so policymakers may want to look dovish, even as the region will enter a recession in the new year.
GBP/USD also floated lower to 1.2252. It had a degree by data indicating the British economy grew for the first time in four months in October, up 0.5% from September.
Nevertheless, GDP in the three months through October was still down 0.3% from September as the U.K. slips toward a slump.
