Though U.S. monthly underlying inflation pressures delivered some signs of moderation in Tuesday’s data, traders ramped up bets that the U.S. central bank will accelerate its monetary tightening measures this year.
Also cogitating on the euro was Russian President Vladimir Putin’s narrative of on-and-off negotiations to end the war in Ukraine as “a dead-end situation” on Tuesday.
In expansion, German lawmakers called for an embargo on Russian oil as soon as possible, further weighing on the region’s growth prospects.
Against a basket of six major currencies, the dollar framed 0.1% up to 100.52, its highest level after April 2020. It has gained almost 3% this month and is on the path to its most significant monthly rise in nine months.
The yen led losers versus the dollar, with the Japanese unit weakening 0.8% to cross the 126 yen to the dollar level for the first time after May 2002.
Euro on Its Lowest Level in A Month
The kiwi was buffeted after the Reserve Bank of New Zealand announced its most pungent rate hike in two decades to curb inflation.
The 50 basis point climb was more significant than many economists had anticipated; it was within traders’ expectations, and policymakers tempered the move by not raising their projected peak for rates.
The euro dropped to $1.0821 overnight, its lowest level versus the dollar in more than a month. They loomed nearby at $1.0837 in early London trading.
The Australian dollar and the offshore Chinese yuan diluted slightly after a surprise dip in China’s imports added investor concerns about weakening demand.