Dollar hovers near one-year high; Bitcoin hits US$50,000

London

THE US dollar edged back towards a one-year high versus major rivals on Tuesday ahead of a key payrolls report at the end of the week, while cryptocurrency Bitcoin hit US$50,000 for the first time in four weeks.

The risk-sensitive Australian dollar was among the biggest fallers, with the Reserve Bank of Australia reiterating that it does not expect to raise interest rates until 2024.

The US dollar index, which measures the currency against six rivals, rose 0.13 per cent to 93.932, moving back towards Sept 30's peak of 94.504, its highest since late September 2020.

The index had rallied as much as 2.8 per cent since Sept 3 as traders rushed to price in tapering of economic stimulus this year and possible rate rises for 2022.

The dollar has also benefited from safe-haven demand amid worries ranging from the risk of global stagflation due to the US debt ceiling stand-off.

Friday's non-farm payrolls data is expected to show continued improvement in the labour market, with a forecast for 488,000 jobs to have been added in September, a Reuters poll showed.

Meanwhile, an index of Asia-Pacific equities fell by 0.74 per cent after a 1.3 per cent tumble overnight for the S&P 500.

The Aussie dropped 0.1 per cent to US$0.7281, retreating further from Oct 4's four-day high of US$0.73045.

The New Zealand dollar declined 0.34 per cent to US$0.6939, also backing away from a four-day peak at US$0.6981. The Reserve Bank of New Zealand (RBNZ) decides policy on Wednesday, with markets priced for a quarter point increase to interest rates.

The dollar gained 0.25 per cent to 111.19 yen, while the euro weakened by 0.21 per cent to US$1.15965.

Sterling edged up 0.15 per cent to US$1.3629 and hit a three-week high against the euro at 85.11 pence.

While the consensus view is for further gains for the greenback - with speculators pushing net long bets to their highest since March 2020 - TD Securities warns that headroom may be limited.

"While the near-term USD bias leans higher, we're wary about chasing the move at these levels," Mark McCormick, TD's global head of FX strategy, wrote in a report.

Cryptocurrencies rallied, meanwhile. Bitcoin, the world's biggest cryptocurrency by market value, hit US$50,000 for the first time since Sept. 7. REUTERS