Yahoo Finance Dollar Inches Up Ahead of Fed; China Reports Strong October Export Data
Investing.com - The U.S. dollar inched up on Thursday morning in Asia as investors awaited the Federal Reserve's latest policy decision later in the day.
The markets are not expecting a change in interest rates. The central bank has hiked rates three times this year on the back of strong economic data. The Fed has signalled a rate rise in December and two more hikes by mid-2019.
The U.S. dollar index that tracks the greenback against a basket of other currencies gained 0.05% to 96.06 by 9:29 PM ET (02:29 GMT).
"The dollar is likely to benefit as we still expect the Fed to maintain its hawkish stance. The U.S. economy needs rising rates as wage pressures are building and there is a risk of an overheating of the economy,” said Sim Moh Siong, currency strategist at Bank of Singapore.
Meanwhile, the Chinese yuan weakened against the dollar as the USD/CNY pair rose 0.18% to 6.9334. Chinese Customs data out on Thursday showed that China’s exports in October jumped 15.6% year-on-year, a hike from September's 14.5% increase. Reuters had earlier forecasted a slowdown to 11% growth.
Growth in imports for October quickened to 21.4% from 14.3% in September, beating analysts' forecast for a slight cooling to 14%.
The People's Bank of China (PBOC) set the yuan reference rate at 6.9163 vs the previous day's fix of 6.9065.
Elsewhere, the NZD/USD pair slipped 0.03% to 0.6785 after the Reserve Bank of New Zealand kept its benchmark rate unchanged at 1.75%, as expected. The central bank added that it was necessary to keep rates at an expansionary level due to below-target inflation.
The AUD/USD also slipped 0.03%, while the USD/JPY pair traded 0.18% higher to 113.73.
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