The euro rose 0.2 per cent to $1.0963, its highest since mid-August, the yen gained over 0.5 per cent to its highest in seven weeks at 147.5 per dollar
The dollar slid to new lows on the euro, yen and other major currencies on Tuesday, as China guided the yuan higher and its strength prompted broader softness for the dollar ahead of minutes from the Fed.
China’s central bank set the midpoint of the yuan’s trading band at its strongest since August 7. The yuan reached an almost four-month high of 7.1301 to the dollar in early trade.
The euro gained 0.2 per cent to $1.0963, its highest since mid-August. The yen gained over 0.5 per cent to its highest in seven weeks at 147.5 per dollar.
The New Zealand dollar broke through resistance around $0.6050 to trade 0.6 per cent higher at a three-month high of $0.6072 by mid-session in Asia. The Australian dollar added 0.4 per cent to reach a three-month high of $0.6585.
China’s firm currency fixing came together with a Bloomberg News report on forthcoming support for the property sector which bolstered stocks and the mood, said National Australia Bank strategist Rodrigo Catril.
It is encouraging the market to think: ‘OK, cool, we’ve seen the worst of CNY weakness,’ Catril added, using the currency’s ticker. They are telling us they want dollar/CNH lower.
Bloomberg News reported Chinese regulators are drawing up a list of 50 developers eligible for funding, citing people familiar with the matter.
At the same time U.S. yields have dropped in anticipation that U.S. interest rates have peaked, the yen is showing signs of turning and the Aussie is riding an extra tailwind while prices for top export iron ore reached multi-year highs.
The dollar index, which has dropped in seven of the past eight sessions, broke below its 200-day moving average on Monday and was 0.2 per cent lower at 103.2 on Tuesday, a 2-1/2-month low.
Sterling increased 0.3 per cent to a two-month high of $1.2540. The Swiss franc hovered near its highest since early September. Trade in Scandinavian currencies tends to be light in Asia hours, but the Swedish crown reached a 3-1/2-month high and the Norwegian crown a two-month high.