Aussie Down In Early Asia, China Prices Ahead
The Aussie was quoted weaker in early Asia on Monday with China reporting prices data that could show whether pressures are building in the economy.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was last quoted down 0.02% to 92.92.
This week, investors will be looking at U.S. housing data to assess the economic impact of the hurricanes which hit the southern U.S. last month. Thursday’s data on third quarter Chinese growth will be closely watched for insight into the health of the world’s second largest economy.
Tuesday’s UK inflation data will also be in focus amid speculation over a possible rate hike by the Bank of England as soon as next month.
Last week, the dollar fluctuated against a basket of the other major currencies on Friday after mixed consumer inflation data clouded the outlook for another rate increase by the Federal Reserve in the coming months.
Consumer prices rose 0.5% last month after advancing 0.4% in August the Labor Department reported Friday. Economists had forecast a 0.6% increase.
It was the largest increase in eight months, but was mainly driven by soaring gasoline prices after hurricanes hit the southern U.S. Underlying inflation remained subdued.
The report came after the minutes of the Fed's September meeting published on Wednesday showed "many participants expressed concern that the low inflation readings this year might reflect not only transitory factors, but also the influence of developments that could prove more persistent."
The data tempered expectations that the Fed will hike interest rates in December for a third time this year.
Expectations that U.S. rates will rise help support the dollar by making U.S. assets more attractive to yield-seeking investors.
European Central Bank President Mario Draghi said the euro zone still requires substantial monetary stimulus as inflation remains muted.
Sterling gained ground amid hopes that Britain could be offered a two-year Brexit transition deal.