Investing.com - The Japanese yen weakened sharply in early Asian
trade on Monday along with the Australian dollar as the market
digested weekend comments from the Federal Reserve chief suggesting
an interest rate hike may happen sooner than expected.
USD/JPY traded at 104.22, up 0.26%, while AUD/USD traded at
0.9298, down 0.19%. EUR/USD traded at 1.3196, down 0.33% and
USD/CHF rose to 0.9170, up 0.35%. There are no major data releases
due in Asia on Monday.
Markets took note of what transpired at the weekend as Janet
Yellen opened the Kansas City Federal Reserve annual symposium in
Jackson Hole, Wyoming, with the observation that conditions in
labor markets have outperformed Fed forecasts--and that if this
continues the Fed funds target rate could rise earlier and more
rapidly than expected.
That is a change of emphasis from the Fed chairwoman.
European Central Bank President Mario Draghi told the Jackson
Hole gathering that the central bank is ready to take more
unconventional action if needed to stimulate a sluggish euro zone
Last week, the U.S. dollar rallied to the highest level in more
than 11-months on Friday following the Yellen remarks.
The US Dollar Index, which tracks the performance of the
greenback versus a basket of six other major currencies, traded at
82.61, up 0.28%.
On Friday the index hit 82.51, the highest since Sept. 6, 2013.
It ended the week at 82.38.
Tensions over the crisis in Ukraine remained in focus after NATO
said it was observing an alarming increase in Russian forces near
the border with Ukraine.
Ukraine declared on Friday that Russia had launched a "direct
invasion" of its territory after Moscow sent a convoy of aid trucks
across the border into eastern Ukraine where pro-Russian rebels are
fighting government forces.
In the week ahead, investors will be looking ahead to key U.S.
data for further indications on the strength of the economy and the
possible future path of monetary policy.
The U.S. will produce data on second quarter gross domestic
product, as well as reports on new home sales, durable goods orders
and initial jobless claims.
On Monday, Germany is to publish the Ifo report on business
climate for August.
Markets in the U.K. are to remain closed in observance of the
Summer Bank Holiday.
The U.S. is to produce data on new home sales for the month of
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