* Fed minutes provide no new catalysts to carry dollar
* Greater U.S. shares sap demand for greenback as a haven
* Graphic: World FX charges https://tmsnrt.rs/2RBWI5E
By Kevin Buckland
TOKYO, April 8 (Reuters) – The U.S. greenback traded close to greater than two-week troughs versus main friends on Thursday, monitoring Treasury yields decrease, after minutes of the Federal Reserve’s March coverage assembly supplied no new catalysts to dictate market course.
Fed officers remained cautious concerning the dangers of the pandemic – even because the U.S. restoration gathered steam amid large fiscal stimulus – and dedicated to pouring on financial coverage help till a rebound was safer, the minutes confirmed Wednesday. =USD which measures the dollar towards a basket of six currencies, was little modified at 92.425 early within the Asian session, after dipping to as little as 92.134 on Wednesday for the primary time since March 23.
The gauge rallied to an virtually five-month excessive at 93.439 on the finish of final month because the U.S. pandemic restoration outpaced most different developed nations, significantly Europe.
“Laborious to argue that the U.S. macro outperformance commerce is exhausted; the sturdy vaccine drive, reopening and stimulus set to provide some exceptionally sturdy rebound information within the subsequent a number of months,” Westpac strategists wrote in a report, forecasting a run at 94.5 for the greenback index, also called DXY.
“Admittedly although, the following DXY upleg might take a couple of weeks earlier than it develops momentum – a number of excellent news is priced in.”
The benchmark 10-year Treasury yield was round 1.67% on Thursday, after dipping beneath 1.63% in a single day. It hit a greater than one-year high of 1.776% late final month.
The S&P 500 eked out a modest achieve on Wednesday, shifting primarily sideways since surging to a report excessive to start out the week.
Though he mentioned the market’s course is tough to name, the chief foreign money strategist at Citigroup (NYSE:) World Markets Japan expects the following transfer for the dollar to be decrease.
“Present market sentiment is delicate risk-on, and below such circumstances the greenback will weaken step by step – however no huge strikes,” Citi’s Osamu Takashima mentioned.
The retreat in U.S. yields has additionally eliminated a driver for greenback positive aspects, he mentioned.
The greenback was little modified at 109.78 yen , stabilising after its retreat from a greater than one-year excessive of 110.97 reached on March 31.
The euro consolidated round $1.1865 after rebounding from an virtually five-month low of $1.1704, additionally touched on March 31.
“The vaccination progress within the Eurozone is considerably lagging that of the U.S., and coronavirus an infection charges within the Eurozone are on the rise once more,” Commonwealth Financial institution of Australia strategist Joseph Capurso wrote in a consumer observe.
“As such, EUR/USD is weak to a transfer decrease in direction of 1.1700 within the near-term.”
Foreign money bid costs at 109 GMT Description
U.S. Shut Pct Change
+109.8900 +109.8100 Euro/Yen
+130.4700 +130.1900 Greenback/Swiss
+0.9295 Sterling/Greenback GBP=D3
+1.3735 Greenback/Canadian CAD=D3
All spots FX= Tokyo spots AFX= Europe spots EFX= Volatilities FXVOL= Tokyo Foreign exchange market information from BOJ TKYFX