Investing.com - The dollar was trading close to six-month lows against a basket of major currencies on Wednesday, amid concerns over the crisis in Ukraine and caution ahead of testimony by Fed Chair Janet Yellen later in the trading day.
USD/JPY touched lows of 101.43, the weakest since April 11 and was last down 0.14% to 101.54.
The dollar remained broadly weaker against the other major currencies ahead of congressional testimony by the U.S. central bank chief later Wednesday. Ms. Yellen was widely expected to reiterate interest rates will remain on hold for longer, in spite of last month’s stronger-than-forecast U.S. nonfarm payrolls report.
Concerns over the crisis in Ukraine also weighed on market sentiment, as conflict between the government and pro-Russian separatists in the east and south of the country continued to escalate, fuelling fears over a civil war.
EUR/USD was trading at 1.3919, not far from not far from the eight-week peaks of 1.3950 struck on Wednesday.
Demand for the euro continued to be underpinned after upbeat service sector data from Spain and Italy on Tuesday bolstered the outlook for the broader recovery in the euro area.
The euro was little changed after official data on Wednesday showed that German factory orders slumped 2.8% in February from a year earlier, confounding expectations for a 0.3% increase.
The pound was almost unchanged against the dollar, with GBP/USD trading at 1.6965, holding below the highs of 1.6993 reached on Tuesday, the highest level since August 2009.
The pound strengthened across the board on Tuesday after a forecast beating U.K. services PMI fuelled expectations for a rate hike by the Bank of England in the early part of next year.
Elsewhere, USD/CHF edged up 0.06% to 0.8748.
The New Zealand dollar was sharply lower, with NZD/USD tumbling 0.86% to 0.8864.
The drop in the kiwi came after central bank Governor Graeme Wheeler warned against the currency's current strength on Wednesday, saying "it would become more opportune for the Reserve Bank to intervene in the currency market to sell New Zealand dollars", in the face of worsening fundamentals.
The comments overshadowed data on Wednesday showing that the number of people employed in New Zealand rose more-than-forecast in the first three months of the year, while the unemployment rate remained unchanged at 6.0%.
Meanwhile, the Australian dollar slipped lower, with AUD/USD dipping 0.09% to 0.9338. In Australia, official data released earlier showed that retail sales growth disappointed expectations in March, rising just 0.1%.
USD/CAD dipped 0.08% to 1.0883.
The US Dollar Index, which tracks the performance of the greenback versus a basket of six other major currencies, was at 79.17, holding just above the six-month trough of 79.09 reached on Tuesday.