Dollar Near 3-1/2 year Low as Fed Easing, Trump Bill in Focus
The US dollar edged off multi-year lows against major peers on Wednesday though remained under pressure as traders considered the potential impact of President Donald Trump’s spending bill, and looming tariff deadlines.
Market participants are in a holding pattern until they get clarity on those matters and as they await US jobs data for June.
The euro was down 0.33% at $1.1770, on Wednesday, but close to its highest since September 2021 hit Tuesday, and the pound was down 0.15% at $1.3722, after hitting a three-and-a-half year top the previous day, Reuters reported.
With the dollar up 0.4% on the Japanese yen at 143.97, that left the dollar index, which measures the currency against six major counterparts, slightly higher at 96.744, but near its overnight over three-year low.
A plethora of factors has weighed on the US currency this year, and it has had its worst first half of a year since the era of free-floating currencies began in the early 1970s.
These include policy uncertainty that makes asset managers jittery about some US holdings and spurs them to increase currency hedges, an unwinding of stretched long dollar positioning, and increased bets in recent weeks on the Federal Reserve easing this year.
