The dollar fell against the yen and lost ground against other currencies on Monday as caution swept markets ahead of a busy week for economic data and events.
The U.S. currency fell nearly 1% against the yen in Asian trading hours, though was off the lows in morning trade in New York. The dollar has rallied sharply this month, accelerating gains after Donald Trump’s presidential election victory. The ICE dollar index DXY, -0.02% a measure of the currency against six major rivals, is up more than 3% month-to-date after hitting a 13-year high last week.
Analysts said a round of minor consolidation in the dollar may be over and that it is likely to trade sideways throughout the week.
“It is unlikely that traders will go short the dollar going into the end of the week when we are expecting a decent jobs report, Italian referendum and presidential elections in Austria over the weekend,” said Marc Chandler, global head of currency strategy at Brown Brothers Harriman.
“However, the dollar is likely to strengthen against the euro as the European Central Bank is expected to extend their quantitative easing program while the Federal Reserve is expected to raise rates in December,” Chandler said.
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