The U.S. dollar was higher against its major counterparts in the New York session on Friday, after a data showed that inflation as measured by the Fed’s preferred gauge surged in September, supporting expectations for a tapering announcement as soon as next week.
Data from the Commerce Department showed that the U.S. personal consumption expenditures index grew 4.4 percent on year, from 4.2 percent in August.
On an annual basis, the core personal consumption expenditures index remained at 3.6 percent for the fourth straight month.
The report showed that personal spending climbed by 0.6 percent in September after jumping by an upwardly revised 1.0 percent in August.
Economists had expected personal spending to rise by 0.5 percent compared to the 0.8 percent increase originally reported for the previous month.
U.S. treasury yields rose, with the benchmark yield on 10-year note touching 1.58 percent. Yields move inversely to bond prices.
Investors looked to the U.S. Federal Reserve’s policy meeting due next week amid growing expectations that the central bank will start raising interest rates within a year.
The central bank is widely expected to announce a reduction in bond purchases when it concludes meeting on November 3.
The currency has been trading in a positive territory against its key counterparts in the European session.
The greenback reached as high as 1.1586 against the euro, up from Thursday’s closing value of 1.1678. Immediate resistance for the dollar is likely seen around the 1.14 level.
Flash data from Eurostat showed that Eurozone inflation accelerated sharply to the highest since 2008 on higher energy prices.
Inflation rose to 4.1 percent in October from 3.4 percent in September. This was also faster than the economists’ forecast of 3.7 percent. A similar higher rate was last registered in July 2008.
The greenback was up against the pound, at a 2-day high of 1.3711. The pound-greenback pair had ended yesterday’s trading session at 1.3786. The greenback may face resistance around the 1.34 region, if it gains again.
Data from the Bank of England showed that the UK secured lending increased in September ahead of the complete tapering off of lower stamp duty from October.
Individuals borrowed a GBP 9.5 billion of mortgage debt in September compared to GBP 4.4 billion in August and economists’ forecast of GBP 6 billion.
The greenback added 0.4 percent to hit a 2-day high of 114.04 against the yen. The pair had closed Thursday’s deals at 113.57. Next near term resistance for the greenback is likely seen around the 116.00 level.
Data from the Ministry of Economy, Trade and Industry showed that Japan industrial production dropped a seasonally adjusted 5.4 percent on month in September
That missed expectations for a decline of 3.2 percent following the 3.6 percent contraction in August.
The greenback rebounded to 0.9146 against the franc, after touching 0.9102, its weakest level since August 30. At yesterday’s trading close, the pair was quoted at 0.9118. Further rally in the currency may challenge resistance around the 0.93 level.
The greenback climbed to a 2-day high of 1.2399 against the loonie, following a 2-day low of 1.2328 logged at 6:30 am ET. The greenback was trading at 1.2343 against the loonie at yesterday’s close. Should the greenback strengthens further, it is likely to test resistance around the 1.26 region.
The greenback firmed to a 2-day high of 0.7136 against the kiwi from yesterday’s close of 0.7199. The greenback is seen facing resistance around the 0.70 area.
The greenback edged higher to 0.7503 against the aussie, from Thursday’s New York session close of 0.7543. Extension of the greenback’s upward trading is likely to lead it to a resistance around the 0.73 level.
Data from the Australian Bureau of Statistics showed that Australia retail sales climbed 1.3 percent on month in September – coming in at A$29.669 billion.
That beat forecasts for an increase of 1.0 percent following the 1.7 percent decline in August.