The dollar edged lower in Asian trading on Monday as some investors took profits after its rise last week to a 14-year peak against a currency basket, though it remained underpinned by expectations of more U.S. interest hikes in the coming year.
The Federal Reserve's interest rate forecasts released on Wednesday, after its widely expected rate increase, showed three more hikes in 2017, which fuelled the dollar's rise to last week's highs.
The dollar index, which tracks the U.S. currency against a basket of six major counterparts, was last down 0.2 percent at 102.720. It climbed as high as 103.560 last week.
The bank sees a 65% chance of its base-case scenario, which is for the Federal Reserve to hike interest rates once in December and possibly two times in 2017, if macroeconomic data remain strong.
China's economy will grow at around 6.5 percent year-on-year in 2017, according to a forecast from government think tank China Academy of Social Sciences (CASS) published Monday
CASS sees quarterly on-year growth of 6.5 percent in the first and second quarters, and 6.4 percent in the third and fourth quarters.
China's property market slowed further last month, with average new home prices in the nation's 70 major cities cooling from October as a raft of government curbs appeared to discourage speculative demand.
Oil prices inched up on Monday in anticipation of tighter crude supply going into 2017 following the decision by OPEC and other producers to cut output to prop up prices.
"With investors now expecting a relatively high level of compliance with the production cut agreements, prices should be well supported," ANZ bank said on Monday.
"Some weakness in U.S. dollar also helped improve investor sentiment."
Swings in the dollar can affect oil demand as they influence fuel prices for any country using its own currency domestically.
Reuters technical commodity analyst Wang Tao said that Brent and WTI crude futures technical chart indicators were bullish, with next resistance points seen at $55.79 and $57.57 per barrel for Brent, and at $52.74 and $53.36 per barrel for WTI crude futures.
Despite this, there were factors that weighed on markets, preventing prices - which remain relatively low - from rising more.
Reference: Reuters
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