The dollar rose to its highest level in eight weeks against major currencies on Monday, with traders' bets declining that the Federal Reserve (the US central bank) will cut interest rates significantly this year in light of the continued strength of the US economy.
The yen and the Australian and New Zealand dollars fell to their lowest levels in two months during early Asian trading, and the euro fell to its lowest level in more than a month at $1.07675. The single currency recorded $1.0782 in the latest trading.
The British pound fell 0.18 percent to $1.2610, after earlier falling to $1.25985, recording its lowest level since January 17.
The dollar index rose to 104.18 against a basket of currencies, reaching its highest level since December. It settled at 104.02 points in the latest trading.
Bets that the Federal Reserve will cut interest rates have declined on the back of the strong US jobs report released on Friday, which far exceeded market expectations, which supports Fed Chairman Jerome Powell's statements at the conclusion of the monetary policy meeting last week that cutting interest rates in March is unlikely.
According to the CME Group's Fed Watch tool, traders expect less than 20 percent that the Federal Reserve will start cutting interest rates in March, compared to about 50 percent a week ago.
On the CBS news program 60 Minutes, Powell said on Sunday evening that the Fed may be cautious in its decision on when to cut interest rates in light of a strong economy that gives central bank officials time to ensure that inflation will continue to subside. Deceleration.
The yen rose slightly in the latest trading to 148.36 per dollar after reaching its lowest level at 148.82 against the dollar earlier in the session.
The Australian dollar recovered its losses and rose 0.05 percent to $0.65145 after falling to $0.64865 earlier on Monday.
The New Zealand dollar rose 0.14 percent to $0.60735 from $0.6048.
Treasury yields also jumped on expectations that interest rates will remain high for longer, with two-year bond yields, which typically reflect near-term interest rate expectations, rising by more than nearly four basis points to 4.4159 percent.
Ten-year bond yields increased to 4.0656 percent.
The yuan fell in trading outside China to 7.1999 against the dollar, consistent with the lowest level recorded on January 17.
The yuan fell in trading inside China to its lowest level in more than two weeks at 7.2225 against the dollar earlier in the session, and in the latest transactions it recorded 7.2121 per dollar.
