Breaking News
Black Friday SALE: Up to 54% off InvestingPro! Register here
Investing Pro 0
Ad-Free Version. Upgrade your experience. Save up to 40% More details

Dollar Up, Investors Await Further Fed Tapering Guidance, U.S. Data

ForexMay 27, 2021 12:38AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
© Reuters.

By Gina Lee – The dollar was up on Thursday morning in Asia, amid growing expectations that the U.S. Federal Reserve will slowly but surely move towards discussing a tighter monetary policy.

The U.S. Dollar Index that tracks the greenback against a basket of other currencies inched up 0.01% to 90.037 by 12:29 AM ET (4:29 AM GMT), surpassing the 90-mark.

The USD/JPY pair inched down 0.06% to 109.07. The yen has been boxed its tightest range against the dollar since December 2019 as it reacted to U.S. rates movements, according to RBC Capital Markets. U.S. yields rose during the previous session, with the benchmark 10-year Treasury yield up 1.7 basis points to 1.5808%.

The AUD/USD pair inched down 0.01% to 0.7738, as Australia’s second-most populous state of Victoria entered a week-long lockdown to curb its latest COVID-19 outbreak.

The NZD/USD pair edged up 0.12% to 0.7289. Investors are still digesting the Reserve Bank of New Zealand’s policy decision, handed down on Wednesday. The decision reinstated the central bank’s rates outlook and projected rates rising from 0.25% currently to 0.49% by September 2022 and to 1.78% by June 2024.

The USD/CNY pair inched down 0.07% to 6.3861. U.S.-China relations were on investors’ radars as U.S. Trade Representative Katherine Tai and Chinese Vice Premier Liu He had a “candid” first phone conversation. The phone call was one of the few top-level meetings between the two countries since U.S. President Joe Biden took office in January 2021.

The GBP/USD pair inched up 0.01% to 1.4116.

Although the Fed has insisted that it would maintain its current dovish policy, some Fed officials have hinted in recent comments that the time to discuss a shift in policy could be approaching sooner than expected.

Fed vice chairman for supervision Randy Quarles said on Wednesday that though "we need to remain patient" in any policy shift, "if my expectations about economic growth, employment and inflation over the coming months are borne out ... and especially if they come in strong ... it will become important for the (Federal Open Market Committee) to begin discussing our plans to adjust the pace of asset purchases at upcoming meetings.”

Quarles’ comments echoed comments made by Fed Vice Chairman Richard Clarida earlier in the week and reinforced the possibility of a policy shift for some investors.

"That's probably behind the dollar strength we're seeing at the moment... the personal consumption expenditures (PCE) deflator will be even more closely watched," Commonwealth Bank of Australia (OTC:CMWAY) currency strategist Kim Mundy told Reuters, referring to the Fed's preferred inflation gauge due to be published on Friday.

"The fact that we're expecting to see quite a strong jump in headline inflation might just reinforce market expectations that maybe the Fed is on track to introduce tapering later in 2021," she added.

Further U.S. data, including GDP for the first quarter of 2021, due to be released later in the day. Other data to be released include initial jobless claims for the past week, as well as Core Durable Goods Orders and Pending Home Sales for April.

Dollar Up, Investors Await Further Fed Tapering Guidance, U.S. Data

Related Articles

India rupee sees worst week in seven on new variant
India rupee sees worst week in seven on new variant By Reuters - Nov 26, 2021

By Swati Bhat MUMBAI (Reuters) - The Indian rupee saw its worst week in seven on Friday, while the benchmark 10-year yield closed at its lowest in more than two weeks as concerns...

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at’s discretion.

Write your thoughts here
Are you sure you want to delete this chart?
Post also to:
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Comments (1)
Mike Chen
Mike Chen May 27, 2021 2:10AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Weak dollar, low interest rate, easy monetary policy, increase spending, lower tax revenue, increase debts………change key digital currency! That’s the plans for this decade!
Are you sure you want to delete this chart?
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
Sign up with Email