- Fed's Lockhart says `very close' to right time for rate hike
- Asian stocks decline on concern global growth is slowing
A gauge of the dollar rose to a two-week high as Atlanta Federal Reserve President Dennis Lockhart said he is comfortable with the central bank raising interest rates this year and as Asian stocks extended a global decline.
The greenback gained versus all except two of its 16 major counterparts as a slump in commodities spurred demand for safer assets. Pacific Investment Management Co., home to the world’s biggest actively run bond fund, said it will maintain positions wagering on a stronger dollar given robust U.S. growth and the prospect of tighter monetary policy.
“You have some U.S. dollar strength, which might be partly Fed related, but you’ve also got some U.S. dollar strength because of the risk aversion,” said Imre Speizer, a senior market strategist at Westpac Banking Corp. in Auckland.
The Bloomberg Dollar Spot Index, which tracks the currency versus 10 major peers, rose 0.1 percent to 1,214.19 as of 9:35 a.m. in Singapore after climbing to 1,214.79, the highest level since Sept. 7. The dollar appreciated 0.1 percent to 120.22 yen and less than 0.1 percent to $1.1117 per euro.
The MSCI Asia Pacific excluding Japan Index of shares fell for a third day, dropping 1.1 percent. Japanese financial markets are shut today for a holiday.
Lockhart said he voted with the Federal Open Market Committee majority last week to keep interest rates near zero because he didn’t want to tighten monetary policy in “the teeth of volatility.”
“But at the same time I feel very close to the right time,” to begin tightening, he said Tuesday after a speech in Montgomery, Alabama.