The U.S. dollar is marching higher to start the New Year and gaining ground on other currencies.
The U.S. dollar index, which measures the American currency against six rivals from around the world, is currently at 101.55, up 0.17%.
The rise represents a rebound for the greenback, which declined 2% in 2023, breaking a two-year win streak for the world’s reserve currency.
The U.S. dollar is rising ahead of the latest U.S. employment data and European inflation numbers that are to be released in coming days and could influence central banks’ upcoming interest rate decisions.
The U.S. dollar is rising as the Euro currency declines 0.17% and the Japanese yen also dips following a major earthquake in that country on New Year’s Eve.
Futures traders are pricing in an 86% chance of interest rate cuts from the U.S. Federal Reserve beginning in March of this year, with over 150 basis points of easing forecast in the year ahead.
Minutes from the last meeting of the U.S. central bank are scheduled to be released on Jan. 4 and could provide further insights into the thinking of policy makers.
Britain’s currency, the Pound Sterling, is trading at $1.2724 U.S., flat on the day, having registered a 5% gain in 2023, its strongest performance since 2017.
The Canadian dollar is also flat at $0.74 U.S. and trading at nearly the same level it was at a year ago.
