Dollar inches back up ahead of Bernanke testimony Foreign-exchange markets were holding their breath early Wednesday ahead of much-awaited testimony from the head of the Federal Reserve, with the dollar creeping higher after losses the previous day. The ICE dollar index DXY +0.13% , which tracks the U.S. currency against six others, edged up to 82.617 from 82.599 late Tuesday in North America. The modest gain retraced some of the index’s loss a day earlier as investors placed bets on whether Fed Chairman Ben Bernanke would repeat his dovish tone seen in remarks the previous week. Bernanke was due to testify before the House of Representatives later in the day, followed by an appearance before the Senate on Thursday in his twice-a-year report to the Congress. Crédit Agricole strategists said early Tuesday that many analysts thought Bernanke could offer a more hawkish take on when the Fed would begin slowing its pace of monetary stimulus. “There seems to be the notion that Bernanke will sound less dovish as compared to last week’s speech. However, there is the risk that such expectations lead to another disappointment, especially as he may stick to the view that rates will stay low for longer than would be implied by a further falling unemployment rate,” they said. The U.S. currency also registered a minor gain on the WSJ Dollar Index XX:BUXX +0.21% , which uses a slightly wider basket than the ICE index, rising to 74.62 from 74.52. But among the major currency pairs, action was muted ahead of Bernanke’s testimony. The euro EURUSD -0.16% , inched down to $1.3137 from late Tuesday’s $1.3142, while the British pound GBPUSD -0.26% traded at $1.5117, little changed from $1.5115. The Japanese yen USDJPY +0.22% also moved sideways, with the dollar at ¥99.29, compared with ¥99.21 Tuesday. The Australian dollar AUDUSD -0.26% stabilized after making very strong gains the previous day on the back of central-bank minutes that showed a wait-and-see attitude toward further easing. The Aussie bought 92.33 U.S. cents, versus 92.39 cents Tuesday.
Posted on: Wed, 17 Jul 2013 05:14:50 +0000
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