Dollar moves higher on the back of Fed comments

Investing.com – The dollar remained close to its intraday high against a basket of global currencies, after receiving a boost from comments from a key Federal Reserve (Fed) policymaker.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, rose by 0.19% to 97.05, close to session highs of 97.08.

In a session lacking in major economic reports, New York Fed president William Dudley gave a boost to the dollar earlier on Monday as he gave an upbeat evaluation of the U.S. economy and warned against halting the current tightening cycle just days after the central bank hiked interest rates by 25 basis points to the current range between 1.00% and 1.25%.

Though markets remained skeptical that the Fed would be able to fulfill its own forecast of one more hike this year, odds did increase to around 37% for an increase in December, from about 32% prior to Dudley’s remarks, according to Investing.com's Fed Rate Monitor Tool.

In other pairs with the greenback, GBP/USD lost 0.20% to $1.2754 with the pound under pressure as the U.K. and European Union (EU) began negotiations Monday on Britain’s exit from the bloc.

Investors were concerned that U.K. Prime Minister Theresa May would lack bargaining strength after her party recently lost their majority in snap elections that she herself called in the hope of creating a “strong and stable government”.

EUR/USD succumbed to dollar strength and traded down 0.22% to $1.1171, despite the fact that French President Emmanuel Macron's government promised on Monday to renew politics in France as final official results showed he had won the commanding parliamentary majority that he had sought to push through his far-reaching pro-growth reforms.

The greenback also strengthened against the yen with USD/JPY gaining 0.33% to 111.27.

In a clear exception to dollar strength USD/CAD slipped 0.08% to 1.3199, as a rebound in oil prices supported upward momentum in the oil-linked Canadian dollar.