The US dollar on Wednesday edged higher against the yen and the euro as traders awaited the outcome of the Federal Reserve’s policy meeting later in the session, and uncertainty over upcoming trade negotiations still weighed on sentiment.
DAILY POST reports that the Fed is expected to leave interest rates unchanged on Wednesday, with investors focusing on any clues about the rate outlook as US tariffs cast uncertainty over the economy.
“We’re still in a trading range with (the dollar) chopping around although we’re a little bit stronger today and some of the weakness relative to the Asian currencies earlier this week has abated a little bit.
“I don’t see the Fed today as an event that could break that trend because we’re still in an incredible period of uncertainty while we’re waiting for the end of this 90-day (tariff) pause and potential deals and a broader understanding of how far the (President Donald Trump) administration wants to push China,”; senior global market strategist at State Street in Boston, Marvin Loh said.
DAILY POST reported earlier that US Treasury Secretary Scott Bessent and chief trade negotiator Jamieson Greer will meet China’s economic ceasar, He Lifeng, in Switzerland this weekend for talks that could be the first step toward resolving a trade war that has disrupted the global economy.
The greenback was up 0.69% versus the yen at 143.335, breaking a three-day falling streak, with Japanese markets reopening after a two-day holiday.
The greenback gave up gains and was down 0.04% against the Swiss franc at 0.82190. On Monday, it hit its lowest since January 2015 of 0.8032.
The Swiss National Bank is ready to intervene in the foreign currency markets and cut rates even below zero to prevent inflation falling below its price stability target, Chairman Martin Schlegel said on Tuesday.
The euro was down 0.07% at $1.135850, after rising 0.48% the day before.
Forex markets took in stride the news that German conservative leader Friedrich Merz was elected chancellor by parliament on Tuesday in a second round of voting after an unprecedented defeat on the first attempt.
France and Germany will set up a joint defense security council that will meet regularly as part of their efforts to boost defense investments.
Earlier this week, a record rally in the Taiwan dollar spread to other currencies in Asia, such as the Singapore dollar and the South Korean won.
The Taiwan dollar has surged against the greenback since Trump’s April 2 announcement of sweeping tariffs on trade partners.
The won reached a six-month high at Wednesday’s opening, but subsequently fell 1.1%. The Chinese yuan weakened 0.07% against the greenback to 7.216 per dollar as China announced a long-awaited rate cut.
