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By Kevin Buckland
TOKYO (Reuters) – The U.S. greenback sagged close to an 11-week low in opposition to its main friends on Wednesday, beneath strain from sliding short-term Treasury yields after a run of weak financial knowledge.
The safe-haven yen strengthened in direction of its highest stage since October with investor sentiment fragile amid the specter of new rounds of tariffs from the administration of U.S. President Donald Trump, whereas the Canadian greenback hovered close to a two-week trough with extra levies as a result of hit subsequent week.
“U.S. knowledge circulation on internet is now disappointing expectations, calling into query the U.S. exceptionalism narrative that had been USD supportive,” stated Tapas Strickland, head of market economics at Nationwide Australia Financial institution.
“Commerce coverage uncertainty is definitely creeping into sentiment,” hurting commodity-linked currencies and buoying these considered as havens, Strickland stated.
The U.S. greenback index, which measures the forex in opposition to six main rivals, slipped 0.1% to 106.17 early within the Asian day, bringing it near Monday’s low of 106.13, the weakest stage since December 10.
A day earlier, the U.S. Convention Board stated its shopper confidence index dropped 7 factors, its largest fall since August 2021, to 98.3, nicely in need of the 102.5 estimate of economists polled by Reuters.
The outcome added to different weak knowledge, pushing expectations towards two quarter-point rate of interest cuts by the Federal Reserve over the rest of this yr, with the following seemingly coming in July, based on market pricing.
The 2-year U.S. Treasury yield declined to 4.086% on Wednesday, sinking again in direction of the low of 4.074% from the day prior to this, a stage not seen since November 1.
Treasury Secretary Scott Bessent stated on Tuesday the economic system is extra fragile beneath the floor than financial metrics recommend, citing rate of interest volatility, sticky inflation and job development centered on the federal government sector, whereas additionally saying that tariffs are an essential income.
Trump stated on Monday that tariffs in opposition to Canada and Mexico would proceed as scheduled, ostensibly from March 4.
Bessent’s feedback and weak knowledge set the U.S. greenback as much as start the worldwide day down 0.1% at 148.865 yen, nearing Tuesday’s low of 148.56 yen, its weakest since October 11.
The U.S. forex edged down from the best since February 12 at C$1.4318, reached within the prior session, dropping 0.1% to C$1.4302.
It was regular at 20.46 Mexican pesos.
The euro added 0.1% to $1.0520, drawing near Monday’s excessive of $1.0528, a stage final seen on January 27.
