The dollar rose to a three-month high against the yen after Federal
Reserve Chairman Ben S. Bernanke said risks to the U.S. economy have
diminished, prompting traders to increase bets on higher interest rates.
The U.S. currency gained for a second day against the euro after
Bernanke said the central bank will ``strongly resist'' any waning of
public confidence in stable prices. U.S. Treasury Secretary Henry
Paulson said yesterday in an interview with CNBC that he would
``never'' rule out currency intervention to prop up the dollar.
Losses in the euro may be limited after European Central Bank President
Jean-Claude Trichet said controlling inflation is vital for supporting
growth and job creation, in an article in Spain's La Gaceta de los
Negocios newspaper today.
EUR/USD retreated from $1.5650 to $1.5560.
GBP/USD fellf rom $1.9755 to $1.9680.
USD/JPY could firm from Y106.20 to Y106.80.
UK data at 0830GMT also sees April industrial production, which isexpected to be flat on the month and rise 0.1% y/y.
European data starts at 0600GMT with May wholesale prices from Germany.
This is followed at 0645GMT by French industry production for April and
Italian industrial production, also for April. At 1230GMT, the US
international trade gap is expected to widen to $59.5 billion, as
imported petroleum prices surged further. Canada international
merchandise trade for April is also due at the same time.