Dollar Snaps Losing Streak Versus Euro With Yellen Set to Speak

  • Greenback advances for first time in four days versus euro
  • Futures show 50% chance of December rate increase in U.S.

The dollar halted its longest losing streak versus the euro since September before Federal Reserve Chair Janet Yellen’s first speech since the central bank met last month.

The U.S. currency also rose against the yen as Yellen prepares to address Congress on Wednesday, after indicating policy makers will review raising rates in December. Fed Vice Chairman Stanley Fischer and New York Fed President William C. Dudley also speak the same day. New Zealand’s dollar led losses versus the greenback, slumping as wages and jobs data missed expectations.

“The markets right now are just waiting for more information, and obviously the bias is for a U.S. rate hike to come a little bit sooner,” said Sireen Harajli, a currency strategist at Mizuho Bank Ltd. in New York. “If we get good numbers this week, and we get more hawkish comments, then I think the dollar will resume some of its strength.”

The greenback climbed 0.5 percent to $1.0964 per euro as of 5 p.m. in New York, halting its longest streak of declines since the period ending Sept. 11. The U.S. currency added 0.3 percent to 121.07 yen.

New Zealand’s kiwi, nicknamed for the image of the flightless bird on its NZ$1 coin, fell 1.2 percent to 66.64 U.S. cents.

Central Banking

Yellen, Fischer and Dudley are making their first public comments since an Oct. 27-28 policy meeting. The central bank is monitoring global economic and financial developments, as well as reports at home, it said in a statement released after the gathering. Officials will consider whether it will be “appropriate” to increase rates “at its next meeting,” the statement said.

Traders see a 50 percent chance that the Fed will boost borrowing costs from near zero in December, up from a 34 percent before the central bank met. The calculations are based on the assumption the effective fed funds rate will average 0.375 percent after liftoff, compared with the current range of zero to 0.25 percent.

New Zealand’s kiwi declined as a report published on Wednesday in Wellington showed employment unexpectedly fell for the first time in three years in the third quarter. Wage growth also trailed forecasts.

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