The U.S dollar, on Thursday, March 16, dipped to a one-month low. Investors snapped up the greenback at the start of European trade, judging it looked cheap after sharp falls following the U.S.
The dollar index recovered all its losses since the close of U.S. trade to stand roughly steady earlier in the day at 100.59. =USD, but lost momentum and fell to 100.41, Reuters reports.
It was also roughly flat on the day at $1.0725 per euro and 113.35 yen. JPY=The pound GBP=D3 hit a two-week high of $1.2373, up 0.6 percent after the Bank of England kept interest rates on hold but gave a handful of hints in voting results and its minutes that it might raise them soon.
The pound also took back all of its gains against the euro, to stand more than half a percent higher on the day at 86.80 pence, after the publication of the minutes. EURGBP=
However, the dollar struggled to make more progress through the European morning and waned as New York traders arrived at their desks.
Meanwhile, the euro was also buoyed by a Dutch election defeat for far-right leader Geert Wilders, which eased broader fears of a populist drift in European polls this year.
Yet the mood was still edgy and there was buying of the market’s favorite safe havens for capital. The Swiss franc gained almost half a percent against the euro while the yen inched back into positive territory, touching a more than two-week high.
Dealers said much of the dollar’s fall overnight looked to have been investors taking some profit on the large bets taken on the currency since November and again in the last fortnight [IMM/FX], in expectation that the Fed would raise rates more sharply than previously expected going forward.
