U.S. dollar strengthens after Yellen comments

The U.S. dollar extended its strength in late afternoon trade Wednesday after Federal Reserve Chairwoman Janet Yellen said the central bank expects a few rate hikes a year until end of 2019.
Earlier, the dollar regained ground against its major counterparts with dip-buying kicking in a day after President-elect Donald Trump triggered selling by suggesting the currency was too strong.
The U.S. currency maintained its strength after data showed that inflation in 2016 rose at the fastest pace in five years. The Federal Reserve’s so-called Beige Book also noted that inflation is heating up. Higher inflation could prompt the Federal Reserve to raise interest rates even more rapidly in 2017.
Over the past several weeks, the dollar had been under pressure in a partial reversal of the currency’s strengthening since Trump’s victory in the U.S. presidential election. That downside bias was amplified by comments from Trump that the dollar was already ‘too strong’ in part because China holds down the value of its currency.
This news item appeared on the marketwatch.com Internet site at 4:25 p.m. EST on Wednesday afternoon — and I thank Swedish reader Patrik Ekdahl for his first of three contributions to today’s column. Another link to it is here. There was another story about this that Patrik sent along as well. This one is a Bloomberg article headlined “Yellen Says Economy Near Goals Warrants Gradual Rate Hikes”
Target shares fell nearly 6 percent on Wednesday, as a massive marketing push and spike in digital sales weren’t enough to make up for fewer shoppers visiting its stores.
Despite ramping up the amount of advertisements that spoke to value; extending its free shipping window an additional week; and bringing in nearly 2,000 exclusive toys, the big-box retailer on Wednesday said that comparable sales declined 1.3 percent in November and December.
Electronics and food continued to struggle, while sales in its so-called signature categories – baby, style, kids and wellness – grew nearly 3 points faster than the company average. Target’s rapid 30 percent digital growth significantly outpaced the performance at its stores, where transactions dropped 1.7 percent. Transactions are often used as a gauge for traffic.
If Target’s in-store transactions continue to shrink in January, the holiday quarter will be the third-straight period in which its traffic has fallen.

This post was published at Market Watch