Investing.com - The dollar fell to fresh session lows against the euro and the yen on Wednesday amid heightened expectations that the Federal Reserve will hold back from tapering stimulus at its upcoming policy meeting next week.
During U.S. morning trade, USD/JPY was down 0.42% to 102.40 after rising to six-month highs of 103.38 on Tuesday.
The dollar weakened amid fresh doubts over whether the Fed will scale back its USD85 billion-a-month asset purchase program at its December 17-18 policy meeting, despite last week’s stronger-than-forecast U.S. nonfarm payrolls report for November.
The dollar shrugged off news that U.S. Congressional leaders reached an agreement on a two year budget deal on Tuesday. Congress will still need to reach a deal to raise the U.S. debt ceiling in February 2014 in order to avert a default.
EUR/USD rose to highs of 1.3800, the strongest level since October 29 and was last up 0.24% to 1.3792.
Demand for the shared currency continued to be underpinned as expectations for further monetary easing by the European Central Bank dimmed after the bank sounded less dovish than expected at last week’s policy meeting.
The euro received an additional boost after European Union finance ministers moved closer to an agreement on a European banking union on Tuesday, a measure which is seen as key in fending off a repeat of the region’s financial crisis.
The pound turned lower against the dollar, with GBP/USD down 0.47% to 1.6363 down from Tuesday’s highs of 1.6466, the strongest level in 27 months.
The dollar was slightly lower against the Swiss franc, with USD/CHF down 0.16% to 0.8859.
The greenback was sharply higher against the Australian and New Zealand dollars, with AUD/USD skidding 0.97% to 0.9060 and NZD/USD tumbling 1.13% to 0.8215.
The greenback edged higher against the Canadian dollar, with USD/CAD inching up 0.10% to 1.0612.
The U.S. dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, inched down 0.07% to 79.92.
During U.S. morning trade, USD/JPY was down 0.42% to 102.40 after rising to six-month highs of 103.38 on Tuesday.
The dollar weakened amid fresh doubts over whether the Fed will scale back its USD85 billion-a-month asset purchase program at its December 17-18 policy meeting, despite last week’s stronger-than-forecast U.S. nonfarm payrolls report for November.
The dollar shrugged off news that U.S. Congressional leaders reached an agreement on a two year budget deal on Tuesday. Congress will still need to reach a deal to raise the U.S. debt ceiling in February 2014 in order to avert a default.
EUR/USD rose to highs of 1.3800, the strongest level since October 29 and was last up 0.24% to 1.3792.
Demand for the shared currency continued to be underpinned as expectations for further monetary easing by the European Central Bank dimmed after the bank sounded less dovish than expected at last week’s policy meeting.
The euro received an additional boost after European Union finance ministers moved closer to an agreement on a European banking union on Tuesday, a measure which is seen as key in fending off a repeat of the region’s financial crisis.
The pound turned lower against the dollar, with GBP/USD down 0.47% to 1.6363 down from Tuesday’s highs of 1.6466, the strongest level in 27 months.
The dollar was slightly lower against the Swiss franc, with USD/CHF down 0.16% to 0.8859.
The greenback was sharply higher against the Australian and New Zealand dollars, with AUD/USD skidding 0.97% to 0.9060 and NZD/USD tumbling 1.13% to 0.8215.
The greenback edged higher against the Canadian dollar, with USD/CAD inching up 0.10% to 1.0612.
The U.S. dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, inched down 0.07% to 79.92.