Dollar hits two-week high against euro ahead of US data

The dollar rose to a two-week high against the euro on Monday as bets on a sharp US monetary easing path eased, with traders awaiting the release of the US jobs report this week.

The dollar rose to its highest level since August 21 against the yen, supported by a rise in long-term US Treasury yields to their highest levels since mid-August after data showed no significant decline in inflation, reducing the likelihood of the US Federal Reserve cutting interest rates by 50 basis points on September 18.

Traders expect a 33% chance of a 50 basis point cut in September, compared with a 67% chance of a 25 basis point cut.

A week ago, traders were 36% likely to see the first possibility.

The dollar rose about 0.27% to 146.60 yen before retreating to 146.04 yen in morning trading by 0510 GMT.

The dollar index against six major currencies rose to 101.79 points in early Asian trading, a level not seen since Aug. 20.

The index was last at 101.72 points.

The euro fell to $1.1042, its lowest since Aug. 19, before trading at $1.1046.

Analysts said a public holiday in the United States on Monday was affecting the dollar’s ​​performance, but a series of economic data including Friday’s nonfarm payrolls data will be released in the coming days.

U.S. Treasuries are not trading on Monday in conjunction with the public holiday, but the yield on the 10-year note was at 3.9110% after rising 4.4 basis points on Friday.

The pound was steady at $1.31255, close to Friday’s low of $1.31095, its weakest since Aug. 23.