Investing.com - The dollar pared losses but remained under pressure against the other majors currencies on Wednesday, as markets digested news that Donald Trump had been elected President of the United States.
EUR/USD was up 0.47% to 1.1077, off a two-month peak of 1.1300 hit overnight.
The dollar plunged after Trump was declared the 45th U.S. President, confounding expectations for a Democratic victory.
Trump received a call from his opponent Hillary Clinton to concede the presidency, after he clinched victories in the key battleground states of Florida, North Carolina and Ohio.
A Trump victory is viewed as negative for financial markets as his policies are source of uncertainty for the U.S. economy.
Following the news, European Central Bank Governing Council member Ewald Nowotny said the ECB is ready to intervene in markets in an emergency.
The Mexican peso pared some of its earlier losses, but MXN/USD was still down 8.42% at 0.0046.
Mexico’s central bank was expected by analysts to raise its benchmark interest rate by between 75 and 150 basis points in an extraordinary meeting on Wednesday if Trump wins.
Elsewhere, GBP/USD was up 0.27% at 1.2417, off one-month highs of 1.2548 reached earlier.
USD/JPY tumbled 1.84% to 103.22, after hitting a one-month trough of 101.19, while USD/CHF shed 0.21% to 0.9758.
Japan reiterated its readiness to intervene in currency markets on Wednesday morning. The country’s Finance Minister Taro Aso had said on Tuesday that Tokyo will need to respond to moves in the currency markets if the U.S. election results cause a sudden spike in the yen.
The Australian and New Zealand dollars were sharply lower, with AUD/USD down 1.25% at 0.7665 and with NZD/USD tumbling 1.30% to 0.7291.
Meanwhile, USD/CAD rallied 0.95% to trade at 1.3414, off a fresh seven-month high of 1.3525 hit earlier in the day, amid declining oil prices.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was down 0.48% at 97.41, after dropping to a one-month low of 95.91 overnight.