Investing.com - The dollar fell to four-month lows against the yen on Wednesday as investor fears mounted over the Trump administrations ability to deliver on policies which would bolster economic growth.
USD/JPY was down 0.3% to 111.36, the lowest level since November 23 after ending the previous session down 0.75%.
Wall Street had its worst day so far this year on Tuesday as hopes faded for swift action on the pro-growth economic agenda promised by President Trump ahead of a key vote on healthcare reform.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was at 99.62 after plumbing 99.45, its lowest since February 2.
The dollar had already come under pressure in recent sessions after the Federal Reserve hiked interest rates last week and reiterated that the future pace of rate hikes would be gradual, disappointing dollar bulls who had hoped for an accelerated pace of monetary tightening.
The dollar has also been pressured lower by the stronger euro as expectations for monetary tightening by the European Central Bank later this year and a more positive outlook for the French presidential elections boosted the single currency.
The euro rose above $1.08 for the first time in six-week on Tuesday after centrist Emmanuel Macron appeared to come out on top in a televised debate against his main rival, far-right anti-EU leader Marine Le Pen.
Le Pen has pledged to take France out of the euro and hold a referendum on EU membership.
The euro was slightly weaker on Wednesday, with EUR/USD dipping 0.16% to 1.0792, off the previous session’s highs of 1.0818.
Sterling remained supported at three-week highs, with GBP/USD at 1.2472 after Tuesday’s UK inflation report showed inflation rising back above the Bank of England’s 2% target for the first time since September 2013 in February.
Meanwhile, the Australian dollar was lower, with AUD/USD falling 0.55% to 0.7649, retreating further from Tuesday’s multi-month highs of 0.7748.