Dollar on defensive with Fed’s Powell likely to appear dovish

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TOKYO – The dollar was trapped on the back

foothold against major peers on Wednesday as markets wait

comments from Federal Reserve Chairman Jerome Powell, who

to renew the commitment to an ultra-easy policy.

The greenback has maintained declines against riskier currencies, with

the recovery in the event of a pandemic hopes to receive a boost as the International

The Monetary Fund has revised upwards its global growth forecast for 2021.

Yields on Treasury bills, the rise of which had supported the dollar to the

at the start of this year, fell overnight amid cautious

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potential size and potential delays of President Joe Biden

$ 1.9 trillion fiscal stimulus package.

“The stronger the global economic outlook, the more

US dollar, ”said Joseph Capurso, currency analyst at

Commonwealth of Australia Bank in Sydney.

“Powell will clarify that they do not see any

short-term exit from their political position very easy, and it is

will pull the dollar down.

Powell due to speak at press conference after Fed move

two-day political meeting that ends Wednesday.

Traders are also closely monitoring progress in the US

stimulus front after Senate Majority Leader Chuck Schumer said

Democrats could try to spend much of the huge

spending program with a majority vote, but it is not clear whether

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they have the numbers to overcome Republican objections.

The dollar index was little changed at 90.172 at the start

in the Asian session, holding Tuesday’s 0.2% decline.

The greenback traded at 103.61 yen, little change

after a 0.1% slip overnight.

The euro was broadly stable at $ 1.21625 after rising

about 0.1% in the previous session.

The riskier Australian dollar gained 0.1% to 77.51 US

cents, adding to Tuesday’s 0.5% rally.

The British pound climbed to $ 1.3753 for the

first time since May 2018 on Thursday, before trading at 0.1%

higher at $ 1.3746.

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Currency auction price at 9:16 am (016 GMT)

Description RIC Last closure US Pct Change YTD Pct High Bid Low Bid

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Previous modification

Session

Euro / Dollar $ 1.2166 $ 1.2160 + 0.05% -0.42% +1.2167 +1.2160

Dollar / Yen 103.6020 103.6450 + 0.00% + 0.34% +103.6300 +0.0000

Euro / Yen 126.05 125.99 + 0.05% -0.69% +126.0700 +126.0100

Dollar / Switzerland 0.8864 0.8869 -0.02% + 0.23% +0.8868 +0.8867

Sterling / Dollar 1.3742 1.3735 + 0.07% + 0.60% +1.3742 +1.3737

Dollar / Canadian 1.2689 1.2695 -0.02% -0.32% +1.2694 +1.2693

Aussie / Dollar 0.7754 0.7748 + 0.10% + 0.82% + 0.7755 + 0.7743

NZ 0.7240 0.7239 + 0.04% + 0.85% +0.7240 +0.7232

Dollar / Dollar

All spots

Tokyo spots

Points of Europe

Volatilities

BOJ Tokyo Forex Market Information

(Reporting by Kevin Buckland; editing by Richard Pullin)