USD Gains First Ahead of Key U.S. Data!


The US dollar traded firmer to monthly gains on Thursday with European inflation data and data from the United States due out, while the yen traded lower as it regained momentum after a policymaker signaled the need to exit ultra-easy policy.

Bitcoin showed improvement, surging past $63,000 for a nearly 50% gain in February. The monthly gain is the largest since December 2020, and a record high above $69,000 is within reach. Most recently it was traded at $62,486.

The US dollar slipped 0.66% against the yen to 149.75 after Bank of Japan member Hajime Takata said he felt the 2% inflation target was achievable if the BoJ opened the way to leaving negative rates.

If this sentiment continues it will drive the dollar's biggest daily decline against the yen in 2024.

Elsewhere the Euro strengthened 0.1% to $1.0847 and was mostly unchanged for the month, as was sterling at $1.2670. The currency strengthened slightly after German government flash inflation data showed the monthly HPI index was higher in February than in January.

French consumer prices rose 3.1% year-on-year in February, slightly more than expected on higher energy prices, while prices in Spain rose 2.9%, in line with expectations, data also released on Thursday showed.

The Federal Reserve's favorite measure of US inflation will be the focus of today's release. The forecast is for an increase of 0.4% month-on-month.

"A stronger-than-expected PCE deflator could cause markets to discount the likelihood of a further May rate cut, while at the same time encouraging a strengthening of the US dollar," said Kristina Clifton, financial strategist at the Commonwealth Bank of Australia.

The New Zealand dollar in particular tried to pare losses at $0.6091, after falling 1.2% against the US dollar a day earlier when the central bank set rates. The Australian dollar strengthened 0.14% to $0.6504 on Thursday for a monthly decline of 0.8%.