The US dollar traded flat at the opening of trading earlier in the week after closing higher at the end of last week following a hawkish statement by Federal Reserve Chairman Jerome Powell.
At the time of writing, the dollar index traded little changed at 104.66 against most major currencies during the Asian session.
The movement of the US dollar on Monday is not expected to change much as the stock and bond markets close on Monday following the Juneteenth National Independence Day holiday.
Last Friday, Powell had promised that the central bank would remain committed in returning inflation to its 2%target, emphasizing the Fed’s strong commitment to price stability contributing to widespread confidence in the U.S. dollar as a store of value.
The next focus will shift to Powell’s testimony before Congress on Wednesday and Thursday that will provide the latest updates to lawmakers on the Fed’s plans to tackle inflation while getting the job market full.
Meanwhile, in the Fed’s latest comment, Governor Christopher Waller expressed his support for another 75 basis point hike at its July meeting if economic data shows they need it.
Moreover, the pound depreciated slightly at the start of the Asian session, as the main focus of the market at this point was on UK inflation data to be released on Wednesday.
Inflation readings in May will be decisive for the next direction of the central bank of England (BOE) in setting interest rates amid rising cost of living in the UK.
The euro traded steady with a slight rise around 1.0500 against the USD. The focus of euro investors this week was on the publication of European Zone manufacturing and services PMI data on Thursday.
