The U.S. dollar advanced in the Asian session on Wednesday, rebounding from recent losses, but retreated as the session progressed after traders chose to pick up riskier assets despite rising worries about a surge in coronavirus infections.
A U.S. Federal Reserve policy meeting is due next week, with policymakers expected to stick with the super-easy monetary policy despite progress on the economy.
Fed Chair Jerome Powell said recently that a coming upswing in inflation readings is likely to be transitory and won’t cause the U.S. central bank to change its monetary policy.
The dollar index, which moved up to 91.43, dropped to a low of 91.09 around noon, and was last seen at 91.14, down 0.11% from previous close.
Against the Euro, the dollar was flat at $1.2037 a little while ago, retreating from $1.1999.
The Pound Sterling, which had weakened to $1.3888, firmed up to $.13928, cutting down its losses. Data from the Office for National Statistics revealed U.K. consumer prices advanced 0.7% year-on-year in March, faster than the 0.4% increase seen in February.
The Yen firmed up to 108.07 a dollar, after having weakened to 108.29 in the Asian session.
The Aussie was stronger, fetching US$0.7752 a unit, about 0.35% more than Tuesday’s close of $0.7726.
The Swiss franc was weaker at 0.9170 a dollar, sliding from 0.9161. The Loonie gained in strength, firming up to 1.2497 a dollar, from C$ 1.2609.
The Canadian dollar advanced after the Bank of Canada left its key rate unchanged and trimmed its asset purchase programme reflecting the progress in the economic growth.
The economic growth in the first quarter appeared considerably stronger than the Bank’s January forecast, as households and companies adapted to the second wave and associated restrictions, the bank said in the accompanying statement.