Investing.com – The US dollar rose on Thursday, while the pound fell ahead of the Bank of England's latest policy meeting.
At 04:00 EST (09:00 GMT), the dollar index, which tracks the greenback against a basket of six other currencies, was up 0.2% at 105.122, approaching the one-month high hit last week at 105.80.
The dollar rises after the holiday
The US currency rose on Thursday after traders returned from a holiday in the United States.
The list of US economic data includes numbers and data for later in the session, as investors look for more clues about when the Federal Reserve will start cutting interest rates.
A number of Fed officials have expressed caution about expecting interest rate cuts too soon, seeking more evidence that inflation has been tamed before the central bank agrees to ease monetary policy.
“It appears that there simply is not enough confidence in the data to prompt a cautious shift in communications, but the forward-looking nature of markets means that data remains more important than the Fed's speakers, and the 50 basis point cuts priced in by the end of the year reflect ING in a note: “Cautious optimism about lower inflation.”
The British pound declines ahead of the Bank of England meeting
The index fell 0.1% to 1.2699, ahead of the Bank of England's latest policy release later in the session.
The central bank is widely expected to keep interest rates unchanged, even after data released earlier this week showed the annual fall to 2.0%, in line with its medium-term target.
This represents a sharp decline from the 41-year high of 11.1% reached in October 2022, but wage growth and underlying pricing pressures remain a concern for the central bank.
The index fell 0.2% to 1.0718, as political tensions in the region continue to affect the single currency.
The European Commission said on Wednesday that France and six other countries should be disciplined for running a budget deficit that exceeds limits set by the European Union, with deadlines to reduce the gaps to be set in November.
This comes after French President Emmanuel Macron called for early elections after his party's poor results in the European Parliament elections, throwing the European Union's second-largest economy into political turmoil.
The bank saved 0.7% to 0.8901 after it cut its key interest rate by 25 basis points, continuing its rate-cutting cycle after the March cut.
The decision was well balanced, given the recent rebound in economic growth and the gently halting low inflation trend in Switzerland.
The yen remains weak
In Asia, it rose 0.2% to 158.44, trading at a one-month high as the yen continued to show weakness after the Bank of Japan took a relatively dovish stance on bond purchasing at its latest policy meeting.
The index traded 0.1% higher at 7.2604, with the Chinese yuan remaining under pressure amid doubts about the strength of the country's economic recovery.