Dollar hovers near two-decade high as CPI keeps aggressive U.S. rate hikes likely

　　div classBodysc17zpet90 cdBBJodivpBy Kevin Bucklandp

　　pTOKYO Reuters – The U.S. dollar held near a twodecade high on Wednesday after U.S. inflation moderated less than markets had expected, keeping the Federal Reserve on course to tighten policy aggressively.pdivdivdiv classBodysc17zpet90 cdBBJodiv

　　pThe dollar index, which measures the greenback against six major peers, slipped about 0.1 to 103.92 on Thursday, but was still close to the 104.19 level reached at the start of the week for the first time since late 2002.p

　　pThe consumer price index climbed 8.3 on an annual basis in April, easing from 8.5 in March but outstripping the 8.1 estimate of economists.p

　　pThe data suggested inflation may have peaked, but was unlikely to cool quickly and derail the Feds current monetary policy plans.p

　　pThe market is fully priced for at least a half percentage point increase to the policy rate at each of the next two Fed decisions, on June 15 and July 27, according to the CME FedWatch Tool.p

　　p“The strongerthanexpected U.S. inflation print heightened concerns over the need for the Fed to accelerate its policy tightening path,” Rodrigo Catril, senior currency strategist at National Australia Bank, wrote in a client note.p

　　pThe May CPI data comes five days before the June Fed meeting, and another “shocker” would make a 75 basispoint hike then a “strong possibility,” he said.p

　　pThe euro rose 0.14 to 1.0526, pulling away a bit from the more than fiveyear low at 1.04695 plumbed at the end of last month. The single currency got a lift as the European Central Bank overnight firmed up expectations that it will raise its policy interest rate in July for the first time in more than a decade.p

　　pThe yen continued to garner support from an easing in longterm Treasury yields from a multiyear peak above 3.2 at the start of the week. p

　　pJapans currency added about 0.1 to 129.835 per dollar, pulling further away from the more than twodecade low of 131.35 reached Monday, as the 10year Treasury yield retreated to an almost twoweek low of 2.862 in Tokyo trading on Thursday.p

　　pThe British pound languished as Brexit headlines returned, with the attorneygeneral for England and Wales advising the government that it would be within its legal rights to scrap large parts of the Northern Ireland protocol, according to the Times newspaper.p

　　pSterling dipped to 1.2230 on Thursday for the first time in almost two years.p

　　pIn cryptocurrencies, bitcoin attempted to retake 30,000 after plunging below that level on Wednesday for the first time since July. It rose as high as 30,090.70 on Friday before last changing hands about flat around 29,185. It dipped as low as 27,757.77 in the previous session