Dollar Rises as Investors Anticipate Yellen’s Speech

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The dollar strengthened against several major currencies on Tuesday, as investors looked ahead to the speech of Federal Reserve Chair Janet Yellen, slated later in the day, for further hints on future rate hikes.

EUR/USD dipped 0.16% to trade lower at 1.1177.

The greenback came under pressure on Monday after disappointing data on U.S. consumer spending and inflation pushed the Atlanta Federal Reserve to scale down its projections for first quarter growth.

The Atlanta Fed revised its first quarter growth expectation to 0.6% from 1.4%.

Personal spending rose 0.1% last month according to recently released data, in line with earlier projections, but January’s spending was scaled down sharply.

Meanwhile, inflation declined 0.1% in February and was up by a mere 1% from a year earlier.

USD/JPY tacked 0.18% to trade higher at 113.64.

The yen fell after Japanese Prime Minister Shinzo Abe stated on Tuesday that he will push through with a planned sales tax increase next month.

Analysts were expecting Abe to delay the planned tax increase as Japan’s economy remained fragile.

Against the pound, the dollar was little changed with GBP/USD steady at 1.4263. It was a bit higher against the Swiss franc, with USD/CHF inching higher 0.08% at 0.9744.

Meanwhile, the Australian dollar was weaker against its American rival, with AUD/USD dropping 0.33% at 0.7520, while NZD/USD tacked on 0.10% to trade at 0.6732.

USD/CAD was little changed at 1.3191.

The U.S. dollar index gain 0.10% to trade at 96.10, remaining near Monday’s one-and-a-half week peak of 96.42.

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