The dollar headed for its best January since 2010 versus a basket of its peers ahead of data forecast to show Americans increased spending for an eighth month, adding to evidence the U.S. economy is growing.
The yen extended monthly gains versus its 16 major peers as equities fell in Japan and data showing accelerating inflation reduced the case for monetary easing. The euro was poised for its biggest monthly decline since March and the first loss since August against the greenback before a European Central Bank policy meeting Feb. 6. New Zealand’s dollar dropped.
“The U.S. expansion has been confirmed, and that’s been taken as a positive for the dollar,” said Yasuhiro Kaizaki, the vice president for global markets in New York at Sumitomo Mitsui Trust Bank Ltd. “The strong dollar is likely to drive euro selling ahead of the ECB meeting next week, amid rising expectations of a rate cut.”
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