By Gertrude Chavez-Dreyfuss
NEW YORK (Reuters) – The dollar fell on Wednesday, tracking a decline in U.S. Treasury yields, amid a mixed set of data suggesting weaknesses in the world’s largest economy, raising the likelihood of another rate hike is further reduced by the American economy. Federal Reserve before the end of the year.
The yen, on the other hand, firmed slightly against the dollar, moving away from the closely watched 150 per dollar mark after a short-lived rise last session fueled speculation that Japanese authorities may have intervened to shore up the currency. to support.
The , which tracks the dollar against six peers, fell 0.3% to 106.69, giving up some of its recent gains after weaker-than-expected U.S. private payroll data based on the ADP National Employment Report. However, the index remained within striking distance of the almost eleven-month high of 107.34 reached in the previous session.
The dollar pared some of its losses after U.S. factory orders rose 1.2% in August, compared with expectations of a 0.2% increase. That more than offset last month’s moderate decline in the US services sector index.
“This morning’s services sector data helped temper expectations ahead of Friday’s non-farm payrolls report, and we have seen a slight decline in the chances of another rate hike before the end of the year due to the Federal Reserve,” said Karl Schamotta, chief market strategist. at Corpay in Toronto.
“More broadly, the rise in government bond yields, and the associated rally in the dollar, appears to be coming to an end.”
The Japanese currency was last flat at 149.04 per dollar on data, after unexpectedly rising almost 2% at one point on Tuesday to 147.30, the strongest in three weeks. The spike came after it fell to 150.165 per dollar, the weakest since October 2022.
“Dollar/yen is now trading quite close to the levels we saw just three sessions ago, which tells me that yesterday’s move was in fact not an intervention,” said Helen Given, currency trader, at Monex USA in Washington. “I see an overwrought reaction from the market to touching that psychological figure of 150.”
Japan’s top currency diplomat, Masato Kanda, said he would not comment Tuesday on whether Tokyo intervened in the exchange rate, although he said: “We have only taken steps that have the understanding of the US authorities.”
However, money market data from the Bank of Japan showed on Wednesday that Japan is unlikely to have intervened in the currency market a day earlier.
Japanese authorities intervened last year for the first time since 1998 to support the yen.
The currency has fallen about 12% against the dollar this year as US Treasury yields have risen sharply compared to Japan’s after the Fed raised rates.
On Wednesday, longer-term government bond yields fell from a 16-year high after the 30-year yield briefly rose above 5% overnight.
Elsewhere, the euro rose 0.5% to $1.0515, not far from Tuesday’s low of $1.0448, the weakest since December, sparking talk of a pullback to $1. It rose even as data showed euro zone retail sales fell much more than expected in August and the bloc’s economy likely shrank last quarter.
Sterling climbed 0.6% to $1.2149, recovering after falling to a nearly seven-month low of $1.2038.
The New Zealand dollar fell after the central bank kept the spot rate steady at 5.5%, as policymakers grew more confident that previous increases were bringing down inflation. That sent the New Zealand unit to its lowest point in almost a month at $0.5871. The last quotation rose 0.2% to US$0.5916.
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Currency bid prices at 4:07 PM (2007 GMT)
Description RIC Last US Close Pct Change YTD Pct High bid Low bid
Previous change
Session
Dollar index 106.7000 107.0700 -0.34% 3.102% +107.2400 +106.5000
Euro/Dollar $1.0513 $1.0467 +0.46% -1.87% +$1.0533 +$1.0452
Dollar/Yen 149.0450 149.0900 -0.03% +13.68% +149.3200 +148.7350
Euro/yen 156.70 155.93 +0.49% +11.69% +156.7700 +155.8400
Dollar/Swiss 0.9162 0.9207 -0.49% -0.92% +0.9231 +0.9140
Sterling/Dollar $1.2147 $1.2078 +0.60% +0.47% +$1.2176 +$1.2039
Dollar/Canadian 1.3746 1.3709 +0.27% +1.45% +1.3779 +1.3691
Aussie/Dollar $0.6327 $0.6302 +0.44% -7.15% +$0.6342 +$0.6287
Euro/Swiss 0.9631 0.9640 -0.09% -2.67% +0.9653 +0.9620
Euro/British Pound 0.8653 0.8667 -0.16% -2.16% +0.8682 +0.8640
NZ $0.5913 $0.5908 +0.16% -6.80% +$0.5925 +$0.5871
Dollar/Dollar
Dollar/Norway 10.9920 10.9550 +0.47% +12.15% +11.0370 +10.9230
Euro/Norway 11.5596 11.4687 +0.79% +10.16% +11.5810 +11.4594
Dollar/Sweden 11.0571 11.0864 +0.29% +6.24% +11.1188 +10.9939
Euro/Sweden 11.6250 11.5911 +0.29% +4.26% +11.6621 +11.5750
