The dollar edged higher versus major peers on Friday but within a narrow range as traders awaited clues from the U.S. non-farm payrolls report on the pace of Federal Reserve policy normalization.
The dollar held close to a 14-month high against the euro on Thursday, as a surge in energy prices raised the risk for the U.S. Federal Reserve to act sooner to normalise policy.
The dollar held at a nine-month high versus the euro on Wednesday as major currencies marked time before the release of the Fed's July minutes, with the kiwi the big mover overnight after its central bank kept interest rates unexpectedly on hold.
USD steady in Asia as commods, virus worries provide bid
SINGAPORE, May 21 (Reuters) - The dollar hovered around recent lows on Friday and was set to notch a modest weekly drop as traders’ concerns at taper talk in Federal Reserve minutes faded, though a pullback in commodity prices and nerves about virus outbreaks kept losses in check.
The dollar has given back a bounce it made after a mention of possible future tapering discussions, in minutes from the Fed’s April meeting, prompted fears of early rate rises.
Investors now figure that any action remains a long way away and that the path might again be clear for a resumption of April’s downtrend as the U.S. trade and account deficits weigh.
Euro breaks to nine-week peak, CAD to 3-year high U.S. GDP set to be strong, trade and budget deficits a drag
SYDNEY, April 29 (Reuters) - The dollar was pinned near nine-week lows on Thursday as a doggedly dovish outlook from the U.S. Federal Reserve and bold spending plans from the White House gave a green light for the global reflation trade.
President Joe Biden’s push for another $1.8 trillion in spending also risked expanding the U.S. budget and trade deficits, a perennial Achilles heel for the dollar.
The euro made the most of the opportunity to hit its highest since late February at $1.2149, before steadying at $1.2134. The break of trendline resistance at $1.2114 opens the way to bull targets at $1.2196 and $1.2242.