Dollar retreats from 2-month high, yuan turns higher
By Samuel Indyk
LONDON (Reuters) — The dollar fell from a two-month high on Monday following five straight weeks of gains, as risk sentiment improved in Europe, with attention already turning to the Federal Reserve's Jackson Hole symposium which kicks off on Friday.
The dollar index, which measures the currency against six other majors, was last down 0.2% at 103.18, but still close to Friday's two-month high of 103.68.
«Risk appetite seems a lot steadier than it has done in the last few weeks which seems to be weighing on the dollar,» said Michael Brown, market analyst at Trader X, noting that European shares are higher and Wall Street futures point to a positive open.
«In the grand scheme of things, moves are pretty limited… I'm loathed to read too much into today's trade before Jackson Hole,» Brown added
Fed chair Jerome Powell is set to speak on Friday, and his comments may set the direction for U.S. Treasury yields, which have driven the rise in the dollar in recent weeks.
Ten-year yields rose 14 basis points last week and touched a 10-month high of 4.328%, within a whisker of a 15-year high. [US/]
The theme this year for the annual gathering in Wyoming is «structural shifts in the global economy».
«Two things that may come across are: decades of ultra-low rates backed by ultra-low inflation may be over,» said Vishnu Varathan, head of economics and strategy at Mizuho Bank in Singapore.
«And global policy-makers may prefer to maintain restrictive real rates for a while.»
Meanwhile, the Australian dollar, at $0.6420, and the New Zealand dollar, at $0.5926, were pinned close to last week's nine-month lows after a rate cut from China disappointed markets worried about a stalling economy.
China cut its one-year
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