SINGAPORE/LONDON—The U.S. dollar steadied on Tuesday, having lost ground a day earlier, climbing particularly against the Japanese yen, and on track for its first monthly gain since September.
The greenback’s rally gathered momentum in recent weeks as upbeat economic data led to mounting expectations that the U.S. Federal Reserve will have to raise interest rates more than initially expected.
The dollar index, which measures the currency against a basket of peers, was flat at 104.7, but was still set for a February gain of 2.5 percent, its first monthly increase since September.
“The dollar has made its rebound—fully justified—on the strength of the January numbers that came through in February, and the repricing for the Fed,” said Ray Attrill, head of FX strategy at National Australia Bank, referring to the strong run of U.S. economic data….