NEW YORK (Reuters) – The dollar rose as investors weighed data on U.S. consumer sentiment and weighed a series of comments from Federal Reserve officials, while the yen was on pace for its fourth decline of the week.
The greenback reversed course to rise modestly after preliminary data from the University of Michigan on consumer morale in May, with the index settling at 67.4, at six-month lows and below the estimate of 76.0 by economists polled by Reuters. Additionally, the one-year inflation expectation rose to 3.5% from 3.2%.
The dollar index gained 0.13% to 105.37, while the euro lost 0.1% to 1.0768 dollars. The dollar is on its way to its first week of gains after two consecutive weeks of declines.
Also supporting the dollar were comments from the president of the Dallas Federal Reserve, Lorie Logan, according to which it is not clear whether monetary policy is restrictive enough to bring inflation to the US central bank’s 2% target, and it is too early to cut interest rates.
That’s in contrast to earlier comments from Atlanta Federal Reserve President Raphael Bostic, who said the Fed is likely poised to cut interest rates this year, although the timing and extent of easing remains uncertain.
Against the yen, the dollar gained 0.3% to 155.86 and is up about 1.8% on the week against the Japanese currency after losing 3.4% last week, due to two suspected interventions by the Bank of Japan.
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(Translated by Luca Fratangelo, editing Antonella Cinelli)
