The dollar rose for the first time in five days on bets that a U.S. budget agreement will boost prospects for the Federal Reserve to start tapering its monetary stimulus, which tends to debase the currency.
The pound rose for a third day versus the dollar as Bank of England Governor Mark Carney said the central bank will end incentives for mortgage lending to head off threats to financial stability from the housing market.
The pound declined from a two-week high against the euro as Bank of England policy maker Spencer Dale said it would take a long time until the U.K. economy was strong enough to justify higher interest rates.
Hong Kong’s futures and options market operator said traders will need to put up additional collateral when using some U.S. Treasury bills to back their positions, citing concern the U.S. is at risk of a default.
The dollar climbed to the highest in almost a month against the yen as signs of improvement in the U.S. economy buoyed speculation the Federal Reserve will start scaling back asset purchases this year.