The dollar slid from a seven-year high against the yen and a two-year peak versus the euro on Monday, as investors consolidated gains made following a strong US jobs report that is expected to trigger an interest rate increase next year. The greenback's outlook remained upbeat despite Monday's fall. Investors were already looking ahead to the December monetary policy meeting of the US Federal Reserve next week, watching for a change in the statement's language to a more hawkish tone.
"We're drifting off in the dollar and this is just consolidation," said Shaun Osborne, chief currency strategist at TD Securities in Toronto. The euro fell to a low of $1.2247 after Nowotny's comments, then flat on the day at $1.2284. The dollar surged to 121.84 yen, before falling 0.6 percent to 120.84 yen. Dealers said the yen was supported by around $2 billion worth of options expiries at 121.50 yen per dollar, putting a cap on the dollar's strength. The dollar index climbed as high as 89.550, its highest since March 2009. The index was last at 89.279, slightly lower on the day.
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