U.S. Dollar Falls Ahead Of Fed Minutes
Washington (July 9) The U.S. dollar weakened against other major currencies in the Asian session on Wednesday, as traders await the release of minutes from the Federal Reserve's June policy meeting, due later in the day.
The Federal Open Market Committee decided to keep interest rates lower for considerable time and cut its monthly asset purchase program by $10 billion to $35 billion in its monetary policy meeting held on June 17-18.
The Fed minutes, due at 2:00 pm ET, may provide further clues concerning the direction of monetary policy
Minneapolis Fed President Narayana Kocherlakota said in a speech to the Minnesota Business Partnership on Tuesday that he expects the inflation to stay below the central bank's target for several more years, possibly even until 2018.
He said that the the central bank should do more to encourage growth and strengthen the job market as the U.S. job market is still too weak and inflation too low.
The U.S dollar fell to a 1-week low of 101.44 against the yen, from an early high of 101.63. At yesterday's close, the greenback was trading at 101.56. The greenback may find support near the 101.10 region.
The Bank of Japan said that the M2 money stock in Japan was up 3.0 percent on year in June - standing at 875.3 trillion yen. That matched expectations, and it also slowed from 3.3 percent in May.
Against the euro, the greenback slipped to a 6-day low of 1.3622 against the euro from an early high of 1.3607. The pair was quoted at 1.3610 at yesterday's close. If the greenback extends its downtrend, it is likely to find support near the 1.37 region.
The U.S dollar edged down to 1.6767 against the pound and 0.8922 against the Swiss franc, from early highs of 1.7125 and 0.8931, respectively. The greenback was trading at 1.7120 against the pound and 0.8929 against the franc. The greenback may test support near 1.72 against the pound and 0.88 against the franc.
Looking ahead, Japan machine tool orders for June and U.K. Halifax house prices for June is due to be released in the European session.
In the New York session, Canada housing starts for June is set to be released.
At 2:30 pm ET, European Central Bank President Mario Draghi will deliver a speech in London.