Dollar declines ahead of important US data By Investing.com

Investing.com – The US dollar fell on Monday at the start of a data-packed week, while the British pound rose on confidence returning to an indicator in the UK.

At 12:16 Riyadh time, the dollar index, which tracks the US currency against a basket of six other currencies, fell 0.06% to 103.239, heading for a monthly loss of about 3%, its worst performance in a year..

Do PCE data support end to Fed hikes?

The dollar was an indirect factor for most of this month’s trading amid growing expectations for a start in interest rate cuts next year after it likely ended its rate hike cycle earlier this month.

These hopes were largely driven by the unchanged reading for October, and traders will turn to another US inflation report on Thursday to support the case for ending Fed rate hikes.

Also, the Fed’s preferred measure of inflation, , is expected to rise 0.1% in November, down from a 0.4% rise in September, which matches the rise in August.

The inflation rate, which excludes food and fuel costs and is considered a better measure of core inflation, is expected to rise 3.5% year-on-year.

Sterling gains on the back of returning consumer confidence

In Europe, it rose 0.1% to 1.2616, rising to its highest level in more than two months, supported by a consumer confidence reading on Friday that showed people in Britain were becoming more optimistic about the outlook for the economy and their personal finances this month.

It kept interest rates unchanged for a second straight meeting earlier this month, with a drop to 4.6% in October from just over 11% a year ago.

However, Bank of England Governor Andrew Bailey said in an interview published earlier on Monday that getting inflation down to the central bank’s 2% target would be “hard work”, as most of the recent decline last year was due to a decline in the jump in energy costs.

According to a poll by the Ifo Economic Institute released on Monday, it rose by 0.1% to 1.0941, as sentiment among German exporters improved in November.

The institute’s export expectations index rose to -3.8 points in November from -6.3 points in October.

“However, the export economy is still unable to develop any momentum,” said Klaus Vollrabe, head of surveys at Ifo. “German companies have not yet benefited much from the economic improvement in many countries.”

Data released on Friday also showed that it contracted by 0.1% in the third quarter compared to the previous three months.

Yuan declines ahead of key PMI data

2111 rose 0.1% to 7.1547, in Asia, after a slightly weaker daily midpoint fix by the People’s Bank of China.

Data on Monday showed that Chinese industrial company profits continued their gains for the third straight month in October, albeit at a slower pace, but all eyes this week are on data for November, due on Thursday for more signs about business activity.

Also, trading was down 0.2% at 149.08, and the yen was among the best performing currencies today, with the Japanese i index trading and available this week.

It also rose by 0.3% to 0.6600, before the release of key data scheduled for later in the week. Reserve Bank of Australia Governor Michelle Bullock is also scheduled to speak this week.