The dollar was firm through Asia trade on Monday, following five straight weeks of gains, as investors looked ahead to the Federal Reserve's Jackson Hole symposium for guidance on where rates might settle when the dust of this hiking cycle clears.
The U.S. dollar made a gain of 0.7% on the euro last week, inched ahead on the yen and surged by more than 1% on the Antipodean currencies as U.S. Treasury yields leapt in anticipation of interest rates staying higher for longer.
In Asia, the Australian dollar , at $0.6406, and the New Zealand dollar , at $0.5919, were pinned uncomfortably close to last week's nine-month lows after China's rate cut disappointed markets worried about a stalling economy.
China cut its one-year benchmark lending rate by 10 basis points and left its five-year rate unchanged, against economists' expectations for 15 bp cuts to both.
The yuan slid to the weak side of 7.3 per dollar despite a firm fixing of its trading range by the central bank.
It last traded at 7.3070, though it has so far kept off last week's lows beyond 7.31 that had brought state banks into spot markets in London and New York hours as buyers.
The Antipodean currencies often function as a liquid proxy for the yuan, owing to the region's exports to China, and are doubly vulnerable as the rate outlook drives up the greenback.
Like the yuan, the yen is also on intervention watch, having fallen to levels around which authorities stepped in last year. It was steady at 145.37 a dollar in Asia.
The euro held at $1.0880. Sterling hovered at $1.2739. The Swiss franc was just above a six-week low hit last week at 0.8820 per dollar.
Apart from waiting in vain for news of stimulus in China, the upcoming Jackson Hole symposium - where Fed chair Jerome Powell is set to speak on Friday - is markets' major focus and may set the direction for U.S. yields.
Ten-year yields rose 14 basis points for the week and touched a 10-month high of 4.328%, within a whisker of a 15-year high. Thirty-year yields rose nearly 11 bps to their highest in more than a decade.
Source : Reuters
