By Zhang Mengying
Investing.com – The dollar was up on Tuesday morning in Asia over expectations that the U.S. Federal Reserve will deliver more interest rate hikes.
The U.S. Dollar Index that tracks the greenback against a basket of other currencies edged up 0.16% to 102.6 by 12:28 PM ET (4:28 AM GMT).
The USD/JPY pair jumped 0.58% to 132.63.
The dollar pushed as high as 132.305 yen on Tuesday - a level not seen since April 2002 as the 10-year Treasury yield rose to 3.05% for the first time in nearly four weeks.
As the yen’s sharp decline dented consumers’ confidence, Bank of Japan Governor Haruhiko Kuroda reiterated an unwavering commitment to “powerful” monetary stimulus on Monday.
"We consider JPY will continue to benefit from safe-haven flows so long as Japan's current account remains in surplus," CBA strategist Carol Kong said in a note.
"As such, we do not anticipate a repeat of the rapid USD/JPY appreciation seen in March and April," she added.
The AUD/USD pair gained 0.51% to 0.7288 ahead of the policy decision from the Reserve Bank of Australia (RBA) , which is due later in the day. The RBA is expected to deliver back-to-back interest rate hikes for the first time in 12 years.
The NZD/USD pair inched up 0.04% to 0.6492.
The euro slipped 0.09% to $1.0686 ahead of the European Central Bank (ECB) 's policy decision on Thursday. Investors have priced in serval hikes from the ECB.
"Friday's inflation report will likely show that inflation is not easing just yet, but that the odds of a recession are still low,” OANDA senior market analyst Edward Moya said in a note.
"Wall Street will need to wait for a couple more inflation reports after this one before anyone can confidently make a call as to when the Fed may alter their tightening course."
Add Chart to Comment
We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:
- Enrich the conversation
- Stay focused and on track. Only post material that’s relevant to the topic being discussed.
- Be respectful. Even negative opinions can be framed positively and diplomatically.
- Use standard writing style. Include punctuation and upper and lower cases.
- NOTE: Spam and/or promotional messages and links within a comment will be removed
- Avoid profanity, slander or personal attacks directed at an author or another user.
- Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
- Only English comments will be allowed.
Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.