Investing.com - The euro and the yen pushed higher against the dollar on Wednesday after remarks by Federal Reserve Chair Janet Yellen tempered expectations for a mid-year rate hike.
EUR/USD was up 0.33% to 1.1377 from 1.1339 late Tuesday, while USD/JPY slid 0.2% to 118.7.
In prepared remarks during testimony to the Senate Banking Committee, Fed Chair Yellen said it was “unlikely” that economic conditions would warrant an interest rate increase for “at least the next couple of FOMC meetings”.
She added that if the economy keeps improving as the Fed expects it will modify its forward guidance, but emphasized that a modification of its language should not be read as indicating that a rate hike would automatically happen within a number of meetings.
On the economy, Yellen said growth was expected to be strong enough to result in a further gradual decline in the unemployment rate and added that while overseas risks remain “the recent decline in world oil prices could boost overall global economic growth more than we expect.”
Demand for the euro continued to be underpinned after Greece’s package of economic reforms was approved by its euro zone creditors on Tuesday, securing Athens an extension of its bailout for another four months.
The package of measures includes taxation and public spending reforms and consolidating pension funds to reduce costs. Athens also pledged not to unwind state privatization programs and to stick to budget targets.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was down 0.33% to 94.21.