Greenback’s march higher takes a break
The greenback’s upward leap lost momentum during the Asian trading session because traders pondered whether markets had gotten ahead of themselves in pricing in the currency’s strength following Donald Trump’s sudden election win.
Currencies across Asia were demonstrating more resistance to the greenback’s recent strength than in recent trading sessions. The currency pair USD/JPY lost 0.02%, clawing back some ground to ¥109.08 after the greenback leapt to a fresh five-month peak of ¥109.23 overnight.
The WSJ Dollar Index BUXX, a measure of the American dollar against a basket of key currencies, slumped 0.14%, reaching 90.28. Emerging market currencies, including the Indonesian rupiah as well as Malaysian ringgit, which have been pounded by the greenback’s ascend, were still down a fraction on Wednesday, but well off their Friday’s lows.
Japanese traders suspect that there’s still more ground for the greenback to cover before investors back off from their bullishness.