singapore march 1 reuters  the dollar began the month on a strong footing as a higherforlonger us rates scenario took centre stage while the aussie slid after a raft of economic data pointed to a slowing economy and signs that inflation might be past its peak australias economy grew at the weakest pace in a year last quarter while the countrys monthly consumer prices rose less than expected in january separate data showed on wednesday the aussie slumped in the aftermath of the data to a twomonth trough and was last 047 lower at 06697 i think market participants will pay a close look to the january cpi indicator in order to gauge the nearterm outlook for the reserve bank of australias policy said carol kong a currency strategist at commonwealth bank of australia cba but given what the rba said at the last meeting they seem to have already made up their minds and want to further raise interest rates the euro slipped 008 to 10567 after failing to rise against the greenback in the previous session even as inflation in two of the euro zones biggest economies rose unexpectedly in february and pushed up rate hike expectations by the european central bank ecb while stillhigh us inflation augurs more fed tightening euro area inflation is higher and stickier in 2023 and the ecb has more tightening to do than the fed said thierry wizman macquaries global fx and rates strategist sterling fell 002 to 12015 reversing a 1 surge at the start of the week after britain struck a postbrexit northern ireland trade deal with the european union british prime minister rishi sunak was in northern ireland and then met with his own lawmakers on tuesday to sell the new deal against a basket of currencies the us dollar index was 009 higher at 10507 having risen nearly 3 in february its first monthly gain since last september the resilience of the worlds largest economy underpinned by a slew of strong economic data released in recent weeks have raised market expectations of a higher peak in us interest rates as the federal reserve battles to tame inflation futures pricing currently suggests a peak of around 54 in the fed funds rate by september we see the fed going to 55 with a growing risk of 6 said michael every global strategist at rabobank the fed is hiking others cant follow or match the dollar will soar elsewhere the dollar rose 012 against the japanese yen to 13638 after having spiked close to 5 against the yen in february its largest monthly gain since last june the kiwi fell 028 to 06167 while the chinese offshore yuan slipped marginally to 69603 per dollar chinas official february manufacturing pmi is due later on wednesday with factory activity in the worlds secondlargest economy expected to have continued to grow last month i would expect a solid report in the pmi readings today in china but i doubt a strong report would give a big boost to the yuan just given the fact that markets seem to be focused on the nearterm outlook for fomc policy which is still in favour of the us dollar cbas kong said