The dollar was steady on the first trading day of the year as traders weighed the prospect of steep interest rate cuts from the Federal Reserve in 2024 and looked to economic data this week for clues on the central bank's next moves.
The dollar index , which measures the U.S. currency against six rivals, fell 2% in 2023, snapping two years of gains, and was last at 101.43, up 0.049% on Tuesday.
Markets are now pricing in an 86% chance of rate cuts to start from March, according to CME FedWatch tool, with over 150 basis points (bps) of easing anticipated in the year.
The euro was down 0.07% to $1.1036, inching away from the five-month peak of $1.11395 it touched last week. The single currency gained 3% last year, its first yearly gain since 2020.
Sterling was last at $1.2726, up 0.02% on the day, having clocked its strongest yearly performance last year since 2017 with a 5% gain.
Meanwhile, the Japanese yen weakened 0.24% to 141.20 per dollar to start the year on the back foot, having slid 7% against the dollar in 2023.
Elsewhere, the Australian dollar was little changed at $0.6813, having ended 2023 broadly flat. The New Zealand dollar was 0.08% lower at $0.6314.
Source : Reuters
