Dollar Strengthens Across the Board – WSJ

dollar to naira

By CHELSEY DULANEY

The dollar rose broadly Monday as investors moved to cover bearish bets on the buck and oil-linked currencies fell.

The WSJ Dollar Index, which measures the buck against a basket of 16 currencies, rose 0.6% to 86.57.

The dollar rose 1.1% to ¥108.33. Japan’s finance minister said Monday that he is “prepared to undertake intervention” in the foreign exchange market if the yen rises further and sharply, his first direct reference to such a possibility.

BNP Paribas analysts said in a research note that the dollar also is being helped by moves to cover short bets on the U.S. currency. Investors have become increasingly bearish on the chances that the Federal Reserve will move soon to raise interest rates.

But Fed officials have recently suggested the market has become too complacent on the chances of rate increases. Higher rates boost the dollar by making it more attractive to yield-seeking investors.

Meanwhile, commodity-linked currencies tumbled amid lower oil prices. The buck was up 1.8% against the Mexican peso to its highest level since late February. The dollar rose 0.3% against the Canadian dollar to C$1.295.