Investing.com - The dollar drifted weaker in Asia on Wednesday with the chaotic U.S. political situation weighing on expectations for economic policies favoring tax cuts and higher spending.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was last quoted down 0.72% to 98.10. USD/JPY changed hands at 112.78, down 0.29%, while AUD/USD edged up 0.05% to 0.7430.
Japan reports core machinery orders for March with a 0.6% gain seen year-on-year and a 2.1% increase expected month-on-month. Australia will also update on its wage price index for the first quarter with a gain of 0.5% seen quarter-on-quarter and 1.9% year-on-year.
Overnight, the dollar slumped against a basket of major currencies on Tuesday, after reports surfaced that President Donald Trump shared sensitive information with Russia at a meeting last week.
Trump took to twitter on Tuesday to defend his decision to share sensitive information with Russia, insisting that he had “the absolute right” to share “facts” about terrorism with Russia.
This latest U.S. political saga, came a week after Trump abruptly fired FBI chief James Comey, and added to concerns that ongoing political turmoil in Washington could prove a distraction to the Trump administration and delay its plans to move forward with its economic agenda, which includes tax reform and deregulation.
Elsewhere, a mixed bout of economic data weighed on the greenback, after U.S. housing data fell short of expectations while industrial production expanded at the fastest pace in more than three years.
The Federal Reserve said Tuesday that U.S. industrial production at factories, mines and utilities rose 1% in April from March, well above expectations for 0.4% increase.
In a separate report on Tuesday, the Commerce Department said housing starts dropped 2.6% to a seasonally adjusted annual rate of 1.17 million units, the lowest level in five months, and below expectations for a 3.7% rise.