FX & CFD trading involves significant risk
The dollar stood near a two-month peak against a basket of currencies on Wednesday after robust U.S. housing data supported the case for the Federal Reserve to raise interest rates in the near term. The U.S. currency also gained on the safe-haven yen as investor risk aversion ebbed on the back of a bounce in European and U.S. equities. The upbeat housing numbers backed the Fed's April policy meeting minutes, released last week, which hinted that the central bank may raise rates soon if the economy appeared strong enough.
Fed Chair Janet Yellen is also due to speak on Friday, which is also the concluding day for the Ise-Shima G7 Summit being held in Japan. Once the G7 summit is out of the way, markets will be focusing whether Tokyo may look to postpone a sales tax hike and implement fiscal stimulus steps.
The Aussie was hit after the market took comments by Reserve Bank of Australia Governor Glenn Stevens to mean the central bank could further ease monetary policy in coming months. Surprisingly low inflation prompted the RBA to cut the cash rate to a record low 1.75 percent earlier this month and has investors betting on at least another easing this year.
EUR/USD: during the Asian session the pair rose to $1.1160
GBP/USD: during the Asian session the pair traded in the range of $1.4600-20
USD/JPY: during the Asian session the pair dropped to Y109.85
Based on Reuters materials
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