International Business: Dollar edges higher as selling pressure abates – Gulf Digital News

International Business: Dollar edges higher as selling pressure abates – Gulf Digital News

NEW YORK - The U.S. dollar was on track to snap a 3-day losing streak on Friday as a selling spree driven by the view that Federal Reserve tightening moves were largely priced-in appeared to abate.

The U.S. dollar index was 0.1% higher at 94.931, but still looked set to finish the week down about 0.9%, its worst weekly showing in eight months.

The greenback, which rose more than 6% against a basket of currencies in 2021, came under pressure this week despite Fed Chair Jerome Powell saying that the U.S. economy is ready for the start of tighter monetary policy and data showing the largest annual rise in inflation in nearly four decades.

"Investors appear to be taking the view that the USD has peaked and that Fed tightening moves are priced in and the likes of the euro offer better potential returns down the road," Scotiabank FX strategists, said in a note.

"We do not concur but have to acknowledge that the USD has suffered a setback — psychologically, at least — by breaking with supportive yield spreads versus its peers and by breaking below the base of its recent consolidation range," they said.

Hedge fund dollar positioning close to the highest