IV:Dollar higher vs. euro before ECB, yen at 2-1/2 year lows
Investing.com - The dollar gained ground against the euro on Wednesday as investors awaited the outcome of Thursday’s European Central Bank meeting, while the yen was close to two-and-a-half year lows as easing expectations weighed.
During European late morning trade, the dollar was close to its highest level against the yen since mid-May 2010, with USD/JPY easing up 0.07% to 93.68.
The yen came under renewed selling pressure after Bank of Japan Governor Masaaki Shirakawa said Tuesday that he was stepping down three weeks before the conclusion of his five year term on April 8, along with his two deputy governors.
The move is likely to push forward a transition towards more aggressive monetary easing, amid ongoing pressure from Prime Minister Shinzo Abe to step up measures to combat deflation.
The greenback was higher against the euro, with EUR/USD down 0.34% to 1.3536.
Investors remained cautious ahead of the outcome of Thursday’s ECB meeting amid worries that President Mario Draghi could signal concern over the impact of the euro’s recent gains on the region’s economic recovery.
The ECB was not expected to announce any changes to existing monetary policy.
The greenback pulled back from five-month highs against the pound, with GBP/USD edging up 0.09% to 1.5671.
The pound remained under pressure as a combination of concerns over the faltering economy and the risk of the U.K. losing its triple-A sovereign rating undermined investor confidence in sterling.
Elsewhere, the greenback pushed higher against the Swiss franc, with USD/CHF rising 0.58% to 0.9134.
The greenback was broadly higher against its Canadian, Australian and New Zealand counterparts, with USD/CAD easing up 0.16% to 0.9971, AUD/USD dropping 0.77% to 1.0308 and NZD/USD falling 0.40% to 0.8416.
The Australian dollar was sharply lower after official data showed that Australian retail sales fell 0.2% in December, compared to expectations for a 0.3% increase. The weak data added to the view that the Reserve Bank of Australia may cut interest rates further in the coming months.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was up 0.25% to 79.77.
