Dollar dips as investors seek Fed rate hike clues
[NEW YORK] The dollar dipped against the euro and the yen Monday in cautious trade as investors weighed the likelihood of a Federal Reserve increase in zero-level interest rates next month.
"The dollar capped off a month of general underperformance with another drift lower as global stock losses benefited the low-yielding euro and safer Japanese currency," said Joe Manimbo of Western Union Business Solutions.
"The dollar struggled as worries about a weakening Chinese economy threw up a potential obstacle for the Fed to raise interest rates," he said.
Federal Reserve officials at a weekend conference in Jackson Hole, Wyoming, gave no clear signal about the timing of the central bank's first rate hike in over nine years.
In a speech, the Fed's number two Stanley Fischer said: "We should not wait until inflation is back to two percent to begin tightening."
"After his speech, if we see some strong US data this week, this will increase the odds of a September rate hike and that should help the dollar," said Omer Esiner of Commonwealth Foreign Exchange.
The upcoming August US jobs report, due on Friday, will be in focus as the Federal Open Market Committee assesses whether the US economy's improvement is strong enough to weather a rate hike.
The key data come less than two weeks before the FOMC announces its rate decision on September 17.
AFP
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