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Dollar remains broadly stronger amid Fed speculation

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Shutterstock photo - The broadly stronger dollar was trading close to four-and-a-half year highs against the yen on Monday, bolstered by speculation that the Federal Reserve may scale back its easing program.

During European late morning trade, the dollar was steady against the yen, with USD/JPY edging up 0.01% to 101.63, after breaching the 102 level earlier, rising as high as 102.16.

The yen fell against the dollar after a weekend meeting of finance ministers from the Group of Seven industrialized economies refrained from criticizing Japan over policies which have resulted in a weaker yen.

The G7 said Japan's policies are aimed at spurring growth in the domestic economy and not at weakening the yen.

The dollar remained broadly stronger amid speculation over a possible near-term exit from the Fed's asset purchase program after recent strong U.S. employment data indicated that the economic outlook is improving.

The dollar was trading close to one-month lows against the euro, with EUR/USD slipping 0.10% to 1.2975.

The single currency remained under pressure after a member of the European Central Bank's governing council said the bank could cut its deposit rate into negative territory. The deposit rate is the rate paid by the ECB on overnight deposits by euro zone banks.

The pound was almost unchanged against the dollar, with GBP/USD dipping 0.01% to 1.5463.

The dollar was fractionally lower against the Swiss franc with USD/CHF dipping 0.06% to 0.9566.

Retail sales in Switzerland fell 0.9% in March compared to a year earlier, official data on Monday showed, confounding expectations for a 0.8% increase.

The greenback was broadly higher against its Australian, New Zealand and Canadian counterparts, with AUD/USD down 0.49% to 0.9970, NZD/USD losing 0.25% to trade at 0.8281 and USD/CAD edging up 0.02% to 1.0107.

The Aussie fell below parity against the greenback to trade at 11-month lows after official data showed that industrial production in China rose 9.3% in April, below expectations for a 9.5% increase.

The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, edged up 0.05% to 83.22.

The U.S. was to release official data on retail sales later in the trading day. - offers an extensive set of professional tools for the Forex, Commodities, Futures and the Stock Market including real-time data streaming, a comprehensive economic calendar, as well as financial news and technical & fundamental analysis by in-house experts.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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