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U.S. Dollar Unchanged as Powell’s Testimony Did Little to Support Rate-Cut Hopes

Published 02/13/2020, 12:16 AM
Updated 02/13/2020, 12:16 AM
© Reuters.

By Alex Ho

Investing.com - The U.S. dollar was unchanged on Thursday in Asia following Federal Reserve Chairman Jerome Powell's second day of testimony on Capitol Hill.

The U.S. dollar index that tracks the greenback against a basket of other currencies was unchanged at 98.922 by 12:15 AM ET (04:15 GMT).

Sentiment for the greenback has turned positive since data last week showed the U.S. labor market is improving.

In his second day of testimony, Powell suggested that there was little reason for the Fed to cut rates as the economy remained in a good place, despite the recent coronavirus outbreak.

The Fed chief said earlier this week that it was too early to determine the virus' impact on the global economy.

The Hubei province, the epicentre of the coronavirus outbreak, today reported 14,840 new cases, up from 1,638 new cases on Tuesday, as it began to include cases diagnosed with a new method.

International Monetary Fund Managing Director Kristalina Georgieva said in a statement that the fund’s primary forecast is for a quick recovery in the world’s second-largest economy.

“We are still at the point of quite a lot of uncertainty,” Georgieva said, adding that the most likely of scenarios is a that of a V-shaped bounce from the interruptions. “In other words, sharp decline in economic activities in China, followed by a rapid recovery and a total impact on China relatively contained.”

Meanwhile, the AUD/USD pair lost 0.3% at 0.6714 after Governor of the Reserve Bank of Australia (RBA) Philip Lowe said the central bank is not "obsessed" with getting inflation back to its 2-3% medium-term target in a hurry.

The RBA slashed rates three times last year to 0.75% to help support growth and inflation.

The NZD/USD pair lost 0.2% to 0.6447. The pair received some support the previous day after the Reserve Bank of New Zealand dropped a reference to the chance of future rate cuts in its policy review.

The USD/JPY pair trade 0.2% lower to 109.87.

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