Investing.com - The dollar was trading slightly lower against the yen on Wednesday, erasing earlier gains after the Federal Reserve said it was growing increasingly unlikely to roll out monetary stimulus programs to spur the economy, which sparked a global dollar rush.
In Asian trading on Wednesday, USD/JPY hit 82.64, down 0.20%, up from a low of 82.63 and off a high of 82.94.
The pair sought to test support at 81.63, Tuesday's low, and resistance at 83.30, Monday's high.
The dollar soared upon release of the Federal Reserve's minutes of its last meeting, which revealed voting members are increasingly inclined to forgo fresh monetary stimulus measures.
Since the recession and ensuing sluggish recovery, the Federal Reserve has swollen its balance sheet by well over USD2 trillion via buying assets from banks like bonds in order to steer the economy away from deflationary contraction and closer towards growth and hiring.
Such moves weaken the dollar, and until recently, the Fed was mum on the need for more such measures, even refusing to rule them out until just prior to Asia's opening on Wednesday, as the labor market remains weak.
"A couple of members indicated that the initiation of additional stimulus could become necessary if the economy lost momentum or if inflation seemed likely to remain below its mandate-consistent rate of 2 percent over the medium run," the Fed said in its minutes.
U.S. inflation rates are up 2.9% on year.
Since monetary easing weakens the dollar, talk of it moving to the backburner sent the greenback firming against other currencies save the yen, against which the dollar cooled its gains.
Then yen has been weakening in recent sessions, in line with Bank of Japan policy, but lately the currency has stabilized and even reversed recent losses amid bottom fishing.
The yen, meanwhile, was up against the pound and up against the euro, with GBP/JPY down 0.35% and trading at 131.31 and EUR/JPY down 0.49% and trading at 109.05.
Later Wednesday in the U.S., the ADP nonfarm employment numbers will hit the wire as well as an ISM report on service-sector activity and government data on crude oil stockpiles.
Also on Wednesday, U.S. Treasury Secretary Timothy Geithner is due to speak.
In Asian trading on Wednesday, USD/JPY hit 82.64, down 0.20%, up from a low of 82.63 and off a high of 82.94.
The pair sought to test support at 81.63, Tuesday's low, and resistance at 83.30, Monday's high.
The dollar soared upon release of the Federal Reserve's minutes of its last meeting, which revealed voting members are increasingly inclined to forgo fresh monetary stimulus measures.
Since the recession and ensuing sluggish recovery, the Federal Reserve has swollen its balance sheet by well over USD2 trillion via buying assets from banks like bonds in order to steer the economy away from deflationary contraction and closer towards growth and hiring.
Such moves weaken the dollar, and until recently, the Fed was mum on the need for more such measures, even refusing to rule them out until just prior to Asia's opening on Wednesday, as the labor market remains weak.
"A couple of members indicated that the initiation of additional stimulus could become necessary if the economy lost momentum or if inflation seemed likely to remain below its mandate-consistent rate of 2 percent over the medium run," the Fed said in its minutes.
U.S. inflation rates are up 2.9% on year.
Since monetary easing weakens the dollar, talk of it moving to the backburner sent the greenback firming against other currencies save the yen, against which the dollar cooled its gains.
Then yen has been weakening in recent sessions, in line with Bank of Japan policy, but lately the currency has stabilized and even reversed recent losses amid bottom fishing.
The yen, meanwhile, was up against the pound and up against the euro, with GBP/JPY down 0.35% and trading at 131.31 and EUR/JPY down 0.49% and trading at 109.05.
Later Wednesday in the U.S., the ADP nonfarm employment numbers will hit the wire as well as an ISM report on service-sector activity and government data on crude oil stockpiles.
Also on Wednesday, U.S. Treasury Secretary Timothy Geithner is due to speak.