Dollar firm ahead of key inflation test, Fed forecast update

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The dollar hovered near a one-month peak against the euro and pushed to a one-week high versus the yen on Tuesday as traders braced for crucial US inflation data and fresh Federal Reserve interest rate forecasts the following day.

The US currency was supported by higher Treasury yields in the aftermath of surprisingly robust domestic jobs data at the end of last week, which sparked a dramatic paring of bets for Fed rate cuts this year.

The Bank of Japan sets policy on Friday, and while investors expect a reduction in the central bank’s monthly government bond purchases as early as this meeting, gaping yield differentials with the US have kept the yen on the defensive.

The Rand is trading at R18.76 to the Dollar, R23.90 to the Pound Sterling and R20.20 to the Euro. The euro is trading at 1.7 to the dollar and the dollar is trading at 157.28 yen.

In Brazil, the dollar is trading at 5.35 real, in Russia at 88.84 rubles, in India at 83.51 rupees and in China at 7.25 yuan.

In commodities, gold is trading at $2,301 and platinum at $961 an ounce, while Brent crude is at $81.45 a barrel.

In the commodities market, platinum is trading at $961 and gold at $2,303 an ounce, while Brent crude is at $81.41 a barrel.