US Markets

Dollar dips slightly, but stuck in range before Powell speech

Credit: REUTERS/DADO RUVIC

The dollar edged lower on Wednesday but stayed within a relatively tight range a day ahead of a highly anticipated speech by Federal Reserve Chairman Jerome Powell.

By Karen Brettell

NEW YORK, Aug 26 (Reuters) - The dollar edged lower on Wednesday but stayed within a relatively tight range a day ahead of a highly anticipated speech by Federal Reserve Chairman Jerome Powell.

Powell is scheduled to address the U.S. central bank’s policy framework review, and investors are focused on whether he will hint at shifting the Fed’s inflation target to an average.

"Targeting average inflation over time rather than setting a fixed 2% goal would likely mean lower rates for longer," said Raffi Boyadjian, senior investment analyst at online broker XM. "If the Fed confirms such a move, the greenback would stand little chance of a meaningful rebound anytime soon."

The Fed is thought to be still finalizing details of its review, however, with an announcement expected at its September meeting.

That risks leaving investors disappointed on Thursday if Powell does not indicate the change is likely.

“The risk is that the market’s disappointed with what Powell has to say, and if that is the case you could see the unwind of dollar shorts," said Bipan Rai, North American head of FX strategy at CIBC Capital Markets in Toronto.

The dollar index, which tracks the greenback's value against a basket of currencies =USD fell 0.05% to 92.95.

The index earlier hit a session high of 93.37 after data showed that U.S. durable goods orders increased more than expected in July.

The euro EUR= dipped 0.11% against the greenback to $1.1820.

The yuan CNH= rose toward a seven-month high at $6.879 after U.S. and Chinese trade officials reaffirmed their commitment to a Phase 1 trade deal, which eased concerns about a diplomatic standoff between the world's two-largest economies.

========================================================

Currency bid prices at 3:32PM (1932 GMT)

Description

RIC

Last

U.S. Close Previous Session

Pct Change

YTD Pct Change

High Bid

Low Bid

Euro/Dollar

EUR=

$1.1820

$1.1833

-0.11%

+5.44%

+1.1840

+1.1773

Dollar/Yen

JPY=

105.9900

106.3600

-0.35%

-2.64%

+106.5500

+105.9700

Euro/Yen

EURJPY=

125.29

125.88

-0.47%

+2.74%

+126.1400

+125.2700

Dollar/Swiss

CHF=

0.9085

0.9075

+0.11%

-6.13%

+0.9120

+0.9073

Sterling/Dollar

GBP=

1.3199

1.3150

+0.37%

-0.45%

+1.3218

+1.3118

Dollar/Canadian

CAD=

1.3150

1.3168

-0.14%

+1.26%

+1.3205

+1.3132

Australian/Dollar

AUD=

0.7232

0.7194

+0.53%

+3.01%

+0.7239

+0.7188

Euro/Swiss

EURCHF=

1.0739

1.0740

-0.01%

-1.04%

+1.0759

+1.0733

Euro/Sterling

EURGBP=

0.8954

0.8997

-0.48%

+5.91%

+0.9006

+0.8948

NZ Dollar/Dollar

NZD=

0.6614

0.6546

+1.04%

-1.81%

+0.6618

+0.6545

Dollar/Norway

NOK=

8.8890

8.9646

-0.84%

+1.26%

+8.9847

+8.8869

Euro/Norway

EURNOK=

10.5104

10.5974

-0.82%

+6.84%

+10.6200

+10.5094

Dollar/Sweden

SEK=

8.7312

8.7532

-0.35%

-6.59%

+8.7891

+8.7153

Euro/Sweden

EURSEK=

10.3215

10.3573

-0.35%

-1.41%

+10.3736

+10.3121

GRAPHIC-U.S. dollar sheds 10% since late Marchhttps://tmsnrt.rs/3lfXwfQ

(Reporting by Karen Brettell; additional reporting by Julien Ponthus in London; editing by Jonathan Oatis and Alistair Bell)

((karen.brettell@tr.com))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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