Dollar edges up as markets wait for U.S. inflation data

Dollar edges up as markets wait for U.S. inflation data

Market participants will also be paying attention to how yields react to a 30-year Treasury auction.  ING strategists wrote in a note to clients that higher inflation would support higher U.S. yields, which could in turn cause the dollar to outperform lower-yielding currencies such as the yen, Swiss franc and euro.The inflation data "should further fuel the narrative that the U.S. economy is starting to overheat and are to likely add to concerns that the Fed's firmly dovish message will be increasingly challenged," ING said.At 0725 GMT, the dollar was up 0.1% against a basket of currencies, at 92.201, moving away from recent three-week lows.The 10-year U.S. Treasury yield was at 1.6979% for its third consecutive day of gains, but still well below the 1.7760% level hit on March 30, which was the highest in over a year."There's a widespread expectation that inflation is set to rise in the coming months, but also a consensus for the most part that this will be a transitory phenomenon," Deutsche Bank strategist Jim Reid wrote in a note.Overnight data showed China's exports rose in March, with import growth rising to four-year highs, signalling an improvement in global demand. Asian stock markets were broadly positive after