The dollar was subdued on Tuesday ahead of testimony by Federal...

The dollar was subdued on Tuesday ahead of testimony by Federal Reserve chair Jerome Powell, which investors will focus on for cues of the path the U.S. central bank is likely to take in tackling sticky inflation.

The dollar index =USD , which measures the U.S. currency against six major rivals, was 0.067% higher at 104.31, having skidded 0.26% overnight. The index is down 0.6% for the month following a 2.6% gain in February.

The Australian dollar AUD=D3 rose 0.01% against the U.S. dollar at $0.673 ahead of the Reserve Bank of Australia's policy decision later in the day where a quarter-percentage point rate hike is widely expected.

The euro EUR=EBS was 0.03% lower at $1.0675, having risen nearly 0.5% overnight. Sterling GBP= was last trading at $1.2025, up 0.03% on the day, while the kiwi NZD=D3 fell 0.08% to $0.619.

The Japanese yen JPY=EBS weakened 0.15% to 136.14 per dollar ahead of the final policy meeting for Bank of Japan Governor Haruhiko Kuroda on Thursday and Friday.

Powell's testimony before Congress on Tuesday and Wednesday will largely dictate currency market moves this week, with the February jobs report due on Friday also keenly awaited.

Kevin Cummins, chief economist at NatWest Markets, said Powell would likely express heightened concern around inflation but would probably stop short of raising expectations for a 50 basis point hike on March 22.

After delivering jumbo hikes last year, the Fed raised interest rates by 25 basis points at its past two meetings, but resilient economic data throughout February stoked fears of the central bank going back to large hikes.

"We suspect he (Powell) will sound noncommittal for now and take his cues from the looming upcoming key data," said Cummins, who expects the Fed to raise interest rates by 50 basis points.

Fed funds futures traders are pricing in a 76% probability the Fed will raise rates by 25 basis points at its March meeting. They also expect interest rates to peak at 5.48% in September and still be above 5% at the end of the year. FEDWATCH

"What has become clear to financial markets is that inflation is proving far stickier than most had felt at the start of the year," ING economists said.

"A return to the disinflation and weaker dollar narrative will have to wait."

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	Currency bid prices at 0115 GMT 

 Description	  RIC		 Last		   U.S. Close  Pct Change	 YTD Pct	 High Bid	Low Bid 
											  Previous				   Change				  
											  Session											
 Euro/Dollar	   EUR=EBS	$1.0679		$1.0684	 -0.04%		 -0.33%	  +1.0687	 +1.0676 
 Dollar/Yen		JPY=EBS	136.1000	   136.0800	-0.03%		 +3.66%	  +136.1650   +136.0350 
 Euro/Yen		 																			 
 Dollar/Swiss	  CHF=EBS	0.9312		 0.9308	  +0.05%		 +0.71%	  +0.9314	 +0.9308 
 Sterling/Dollar   GBP=D3	 1.2027		 1.2027	  +0.01%		 -0.54%	  +1.2029	 +1.2017 
 Dollar/Canadian   CAD=D3	 1.3613		 1.3612	  +0.03%		 +0.49%	  +1.3618	 +1.3612 
 Aussie/Dollar	 AUD=D3	 0.6728		 0.6732	  -0.04%		 -1.28%	  +0.6733	 +0.6728 
 NZ				NZD=D3	 0.6192		 0.6197	  -0.08%		 -2.48%	  +0.6198	 +0.6190 
 Dollar/Dollar																				   

All spots FX= Tokyo spots AFX= Europe spots EFX= Volatilities FXVOL= Tokyo Forex market info from BOJ TKYFX

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World FX rates	https://tmsnrt.rs/2RBWI5E 

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