The U.S. dollar edged higher in early European trade Monday, retaining last week's strength at the start of a week that includes several central bank meetings, most importantly by the Federal Reserve, as well as a slew of important economic data releases.
At 03:20 ET (08:40 GMT), the Dollar Index, which tracks the greenback against a basket of six other currencies, traded 0.1% higher at 106.445. The index gained around 1% last week.
The U.S. dollar has been on the front foot of late, helped by signs of U.S. economic strength, even after a prolonged period of interest rate hikes by the Federal Reserve.
USD/JPY fell 0.1% to 149.50, with the yen getting a slight reprieve after the pair rose to a one-year high of 150.78 last week.
The focus was squarely on the conclusion of a BOJ meeting on Tuesday, where the central bank is expected to potentially announce further changes to its yield curve control policy, as it grapples with high inflation and a severely weakened yen.
EUR/USD fell 0.1% to 1.0554, with the single currency retreating after data showed inflation falling in the eurozone, just a few days after the European Central Bank ended the longest streak of interest rate rises in its 25-year history last week, leaving its main policy rate at 4%.
Data released early Monday showed that consumer prices rose 3.1% in October on an annual basis in the state of North Rhine Westphalia, Germany's most populous state, a drop from 4.2% the prior month.
Additionally, Spanish CPI rose 0.3% on the month in October, below the 0.6% expected, and climbed 3.5% on an annual basis, below the expected 3.8%.
GBP/USD fell 0.2% to 1.2094, with the Bank of England also holding a policy meeting later in the week.
The central bank is widely expected to keep interest rates on hold despite growing worries about a recession, with its inflation rate at 6.7% in September, the highest among the world's major economies.
Elsewhere, AUD/USD rose 0.3% to 0.6352, NZD/USD rose 0.1% to 0.5820, and USD/CNY edged higher to 7.3185, with markets waiting for key Chinese purchasing managers index data due on Tuesday.
Source: Investing.com
