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The U.S. dollar firmed against its major rivals on Monday amid rising speculation the Federal Reserve will start reducing monthly bond purchases before the end of this year despite soft U.S. non-farm payrolls data.

Against the Japanese currency, the dollar climbed to a three-year high, rising to 113.42. It is currently fetching 113.37 a unit, up more than 1% from Friday’s close.

Against the Euro, the dollar has firmed to 1.1554, gaining 0.2%.

The Pound Sterling has weakened to $1.3592 from $1.3617. Hawkish comments from Bank of England officials have intensified hopes that the central bank is likely to raise rates sooner than previously expected.

BoE policy maker Michael Saunders told The Telegraph on Saturday that inflationary surge “could become more persistent unless monetary policy responds.”

“I think it is appropriate that the markets have moved to pricing a significantly earlier path of tightening than they did previously,” Saunders said.

Earlier last week, Governor Andrew Bailey had warned that inflation exceeding the BoE’s goal of 2% will be damaging the economy.

Against the Aussie, the dollar weakened to 0.7345, easing from $0.7308.

The Swiss franc is down marginally at 0.9279 a dollar, compared with Friday’s close of 0.9273.

The Loonie weakened to 1.2484 a dollar, down marginally from the previous close of 1.2473.


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