The Dollar Strengthened Against the Yen

The dollar strengthened on Monday as robust consumer expenditure statistics indicated continuing underlying inflation pressure, dampening expectations that the U.S. The Federal Reserve may signal a pause in its rapid interest rate hikes.

The greenback was 0.44% higher against the Japanese yen at 148.08, boosted by the Bank of Japan’s decision to maintain ultra-low interest rates on Friday.

In early Asian trade, the dollar rose broadly, rising more than 0.232% against the New Zealand dollar and the pound. It recovered some of last week’s losses after falling on hopes of a Fed reversal.

According to data released on Friday, consumer expenditure in the United States increased more than predicted in September while underlying inflation pressures remained elevated.

Following this week’s FOMC meeting, officials should announce another 75 basis point rate hike on Wednesday.

Sterling recently fell 0.19% to $1.1593 but continued its monthly gain of around 4% as former British Prime Minister Liz Truss’ economic plans began a strong recovery after last month she caused market volatility.

The euro was down 0.09% at $0.99595, but it was also on track for its first monthly rise of more than 1% since May.

The Australian currency is strengthening ahead of another central bank announcement this week.

Inflation reached a 32-year high last quarter. Hence, the Bank of Australia should raise interest rates by a relatively moderate 25 basis points at its meeting on Tuesday.

The kiwi was last 0.14% lower at $0.580175. However, it remained on course for a more than 3% monthly gain, reversing two months of losses.

The U.S. dollar index slipped 0.02% to 110.79 against a basket of currencies. However, it was still far from a one-month low of 109.53 recorded last week.