Dollar tracks global yields lower; sterling heavy
By Rae Wee
SINGAPORE (Reuters) — The dollar fell broadly on Wednesday as it tracked a global decline in bond yields, while sterling struggled to retain gains following dovish comments from Bank of England (BoE) Governor Andrew Bailey on the central bank's rate outlook.
The greenback slipped below 150 yen in early Asia trade and last bought 149.93 yen, giving the Japanese currency some breathing space having been pinned near a three-month low in previous sessions.
In the past, traders have viewed 150 as a line in the sand that could trigger currency intervention from Japanese authorities, such as was the case in late 2022.
The move lower in the dollar has come on the back of a dip in U.S. Treasury yields in line with its global peers. [US/]
That followed lower-than-expected Canadian inflation data and euro zone wage growth — all of which sent domestic yields falling as it ramped up expectations for rate cuts by global central banks this year.
The Canadian dollar was last little changed at 1.3525 per U.S. dollar, while the euro rose 0.03% to $1.0809.
The U.S. dollar index steadied at 104.05.
«Interestingly, the order and extent of policy moves that are implied by market rates seem to have only the vaguest of correlations with the levels of economic activity in each of the G10 economies,» said Jane Foley, senior FX strategist at Rabobank.
«It is clear that the process of calibrating the timing and pace of central bank policy moves this year still has some way to go.»
Still, the Federal Reserve remains the king of central banks, and minutes of its latest policy meeting due later on Wednesday will provide further clarity on the outlook for U.S. rates.
«The overarching FOMC minutes takeaway must be that it is not (yet) time to
Read more on investing.com
