The U.S. dollar rose to a five-month peak against major peer currencies on Tuesday following stronger-than-anticipated U.S. retail sales data. This has raised concerns of a potential intervention from Tokyo as the Japanese yen languishes at levels not seen since 1990.
Read more: U.S. dollar decline triggered by speculation of Fed rate cut
U.S. retail sales data released on Monday showed a 0.7 percent increase last month. In response, the U.S. dollar index reached 106.39 on Tuesday, the highest point since early November.
The yen hovered around 154.40 per dollar, nearing a new resistance level of 155. Meanwhile, the onshore Chinese yuan fell to 7.2831 per dollar.
The euro declined to $1.06070, and the Australian dollar dropped to $0.64085, its lowest since mid-November. Similarly, the New Zealand dollar slid to $0.58815.
The robust U.S. economic data has fueled speculation that the Federal Reserve may need to keep interest rates higher for longer, bolstering the U.S. dollar against other major currencies.
Earlier this month, consumer sentiment in the U.S. declined from 79.4 in March to 77.9, accompanied by increased inflation expectations among households according to the latest survey by the University of Michigan. These results suggest that persistent inflationary pressures may lead the Federal Reserve to delay interest rate cuts until September, as policymakers express concerns over the economic trajectory of the country.
For more news on markets, click here.
