U.S. dollar takes breather from rally, hovers just off 16-month top

 U.S. dollar takes breather from rally, hovers just off 16-month top

IronHeart | Moment | Getty Images

The dollar hovered below a 16-month peak in early Asian trade on Thursday, having lost ground on the pound and yen overnight as the U.S. currency took a breather while traders considered whether its recent surge was starting to run out of steam.

Sterling was at $1.3491, a one week high against the dollar having jumped 0.5% on Wednesday after a jump in Britain’s October inflation piled pressure on the Bank of England to hike rates at its meeting next month.

Against the Japanese currency, at 114.18 yen the dollar was still in sight of Wednesday’s 4-1/2-year high of 114.97, and the euro was at $1.1316, languishing near a 16-month low with markets seeing the eurozone near the back of the central bank rate-hike queue.

Strong U.S. retail sales data earlier this week added fuel to the dollar’s recent rally, which started last week after a strong U.S. inflation print bolstered market bets that the Federal…

Read full article…www.cnbc.com