News by Akintaro oluwafemi akins
The dollar dropped Thursday as records from
the Federal Reserve’s last meeting dampened
hopes of an imminent US interest rate hike.
Minutes from the US central bank’s July
gathering said policymakers were keeping
their “options open” but remained divided
on the threat of inflation.
A hike in US borrowing costs would tend to
lift the dollar by stirring demand for dollar-
denominated assets, so Wednesday’s minutes
weighed on the unit.
The news comes after William Dudley, the
influential head of the Federal Reserve’s New
York branch, unexpectedly hinted this week
that a rate hike was possible as early as
September.
“The message appears to be that as much as
a September hike is a possibility, the Fed is
unlikely to move until there is a consensus
on the outlook for growth, hiring and
inflation,” Rodrigo Catril, a currency
strategist at National Australia Bank, said in a
commentary.
“Recent data would therefore suggest a hike
is not imminent.”
The dollar fell as low as 99.65 yen from
100.28 yen Wednesday in New York, before
creeping back above the 100 yen level in
afternoon trading.
The euro was down at 113.11 yen from 113.19
yen, while it rose to $1.1306 from $1.1287.
The yen has been on a tear since wild market
volatility at the start of the year and Britain’s
June vote to quit the European Union pushed
investors into the currency, seen as a safe bet
in times of turmoil.
This year, the Japanese currency has surged
more than 20 percent against the dollar and
about 15 percent against the euro.
On Thursday, the dollar also fell against most
higher-yielding, but riskier, emerging market
units.
The Malaysian ringgit tacked on 0.5 percent
against the US unit, while the Indonesian
rupiah was up 0.3 percent and the Thai baht
rose 0.2 percent.
The South Korean won, Singapore dollar and
Philippine peso also advanced.
The dollar dropped Thursday as records from
the Federal Reserve’s last meeting dampened
hopes of an imminent US interest rate hike.
Minutes from the US central bank’s July
gathering said policymakers were keeping
their “options open” but remained divided
on the threat of inflation.
A hike in US borrowing costs would tend to
lift the dollar by stirring demand for dollar-
denominated assets, so Wednesday’s minutes
weighed on the unit.
The news comes after William Dudley, the
influential head of the Federal Reserve’s New
York branch, unexpectedly hinted this week
that a rate hike was possible as early as
September.
“The message appears to be that as much as
a September hike is a possibility, the Fed is
unlikely to move until there is a consensus
on the outlook for growth, hiring and
inflation,” Rodrigo Catril, a currency
strategist at National Australia Bank, said in a
commentary.
“Recent data would therefore suggest a hike
is not imminent.”
The dollar fell as low as 99.65 yen from
100.28 yen Wednesday in New York, before
creeping back above the 100 yen level in
afternoon trading.
The euro was down at 113.11 yen from 113.19
yen, while it rose to $1.1306 from $1.1287.
The yen has been on a tear since wild market
volatility at the start of the year and Britain’s
June vote to quit the European Union pushed
investors into the currency, seen as a safe bet
in times of turmoil.
This year, the Japanese currency has surged
more than 20 percent against the dollar and
about 15 percent against the euro.
On Thursday, the dollar also fell against most
higher-yielding, but riskier, emerging market
units.
The Malaysian ringgit tacked on 0.5 percent
against the US unit, while the Indonesian
rupiah was up 0.3 percent and the Thai baht
rose 0.2 percent.
The South Korean won, Singapore dollar and
Philippine peso also advanced.