“The dollar approached the strongest since August 2009 versus the yen as signs the American economy is gaining momentum boosted demand for the U.S. currency.
The Dollar Index (DXY) traded within 0.2 percent of the highest in seven months before reports this week that economists said will show retail sales improved in February and consumer prices increased. Hungary’s forint slid to a nine-month low versus the euro on concern central bank President Gyorgy Matolcsy is concentrating power in a bid to reshape monetary policy making. South Korea’s won weakened after the North threatened to target the South’s incoming defense minister.
“There are still some headwinds in the U.S. economy coming from its fiscal outlook but the recent data suggested the economic recovery is probably robust enough to accommodate the fiscal setback,” said Jane Foley, a senior foreign-exchange strategist at Rabobank International in London. “That should be positive for the dollar.”
The dollar rose 0.1 percent to 96.08 yen at 7:50 a.m. in New York after climbing to 96.55 on March 8, the highest level since Aug. 11, 2009. The U.S. currency gained 0.1 percent to $1.2999 per euro. The yen was little changed at 124.89 per euro after sliding to 125.92 on March 8, the weakest since Feb. 14.
Rabobank predicts the dollar will strengthen to $1.28 per euro in three months, compared with its previous forecast of $1.30, Foley said.
