The dollar maintained a gain against the yen from yesterday before data on U.S. employment and manufacturing that may influence market expectations for when the Federal Reserve will pare back its stimulus measures.
The Bloomberg Dollar Index yesterday advanced by the most in two weeks after a report showed sales of new U.S. homes rose to the highest level in five years. Fed Chairman Ben S. Bernanke told Congress last week that any reduction in stimulus would depend on the economy’s performance. The yen held near a two-month low versus the euro. New Zealand’s dollar climbed as the central bank signaled an end to record-low interest rates.
“Everyone’s focused on the data since Bernanke said the economy would determine the timing of any changes in policy,” said Koji Iwata, a vice president of foreign-exchange trading at Mizuho Corporate Bank Ltd. in New York. “From a policy perspective, the Fed is the major central bank closest to tightening, so looking over the longer term, the dollar should rise.”
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