Dollar in Asia
Investing.com — The dollar weakened against the yen in Asia on Wednesday and the kiwi has a bump from better-than-expected account as the Fed prepares to detail its points of view and with investors awaiting the latest Bank of Japan policy review due on Thursday.
The USD/JPY changed hands at 111.51, down 0.08%, while the AUD/USD is currently trading at 0.8017, up 0.07%. NZD/USD is traded at 0.7324, up 0.10%.
Of the policy-making FOMC will announce plans to start unwinding its $ 4.5 trillion bond portfolio at the conclusion of its meeting Wednesday.
As well as the plans of balance sheet unwinding, the Fed’s Summary of Economic Projections and dot plot are supposed to collect a large part of the attention, as investors are likely to assess whether the slowdown in the pace of inflation has changed the central bank’s longer-term interest rates.
The US dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, fell 0.13% to 91.50.
New Zealand reported its current account balance for the second quarter with a deficit of 2.8%, compared with 3% seen on a NZ$7.49 billion gap over the year, narrowe than the NZ$8.08 billion expected. Japan reported its trade balance for the month of August to ¥114 billion, compared to ¥94 billion surplus seen.
Overnight, the dollar was almost unchanged against a basket of major currencies on Tuesday, a mixed report on U.S. housing activity has weighed on sentiment, but the easing of the geopolitical uncertainty of limited losses to the greenback.
The dollar is under pressure after a pair of mixed reports on the U.S. housing sector tapered to investor expectations of strong third quarter growth.
The Commerce Department said Tuesday U.S. residential construction fell by 0.8% to a seasonally adjusted annual rate of 1.18 million units in August, well below economists ‘ estimates of a 1.7% rise.
The report also highlighted a sharp 5.7% rise in building permits to a rate of 1.3 million units. It was the highest level since the month of January, beating forecasts of a 0.8% decline.
The downward momentum of the dollar is limited, however, because it made strong gains against their safe haven counterparts like the yen and the Swiss franc in the middle of the discoloration of the geopolitical uncertainty of the Korean Peninsula.