Although the greenback remained on the back foot in Asia and Europe due partly to weakness in U.S. Treasury yields, dollar regained traction in New York and ended higher against majority of its peers on Wednesday as Federal Reserve's March meeting minutes showed that the central bank will continue to extend its monetary policy until the economy's recovery is more secure.
Reuters reported Federal Reserve officials remain wary about the ongoing risks of the coronavirus pandemic and are committed to bolstering the economy until its recovery is more secure, minutes of the U.S. central bank's latest policy meeting showed on Wednesday. With their own forecasts projecting the strongest run of U.S. economic growth in nearly 40 years, "participants agreed that the economy remained far from the (Fed's) longer-run goals and that the path ahead remained highly uncertain," the minutes from the March 16-17 meeting said.
Versus the Japanese yen, price met renewed selling at 109.89 at Asian open and dropped to a 1-week low at 109.59 in Asia before staging a rebound to 109.93 in European morning in tandem with U.S. yields. However, price retreated once more to 109.61 in New York morning and then recovered to 109.87 after release of FOMC minutes.
The single currency moved sideways inside a narrow range in Asia before rising from 1.1865 at European open to a 2-week high at 1.1914 in New York morning on usd's broad-based weakness together with cross-buying vs sterling. However, the pair then fell to session lows of 1.1862 in New York on FOMC minutes.
The British pound went through a volatile session as despite initial drop from 1.3839 in Asia to 1.3773 at European open on cross-selling in sterling, price rebounded strongly to 1.3837. However, the pair met renewed selling there and tumbled to 1.3728 in New York morning before staging a short-covering rebound to 1.3793 but only to fall again to a 6-day low of 1.3725 after release of Federal Reserve's meeting minutes.
Data to be released on Thursday:
Japan current account, trade balance, consumer confidence, Germany industrial orders, France imports, exports, current account, trade balance, UK RICS housing price, construction PMI, EU producer prices and U.S. initial jobless claims, continuing jobless claims.
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