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Dollar Hits 6-Month Highs vs. Yen on Powell Comments

Dollar hits 6-month highs vs. yen on Powell comments

Investing.com - The broadly stronger dollar hit six month highs against the yen on Wednesday as optimistic comments from the head of the U.S. Federal Reserve reinforced expectations that the central bank is on track to keep gradually raising interest rates.

USD/JPY was up 0.16% to 113.06 by 03:40 AM ET (07:40 AM GMT), the most since January 9 after rising 0.65% on Tuesday.

The dollar was boosted after Fed Chairman Jerome Powell gave an upbeat assessment of the outlook for the U.S. economy and downplayed the impact of uncertainty over U.S. trade policy on the outlook for additional rate hikes.

He made the remarks during closely watched congressional testimony on Tuesday.

The U.S. dollar index, which measures the greenback’s strength against a basket of six major currencies, was up 0.31% to 95.02, within close reach of the eleven-month high of 95.25 reached in late June.

The euro was lower, with EUR/USD down 0.34% to 1.1620 after falling 0.49% in the previous session.

The pound was hovering near three-week lows, with GBP/USD slipping 0.19% to 1.3083 after losing almost 1% on Tuesday.

In addition to the stronger dollar, sterling has been pressured lower by a fresh bout of Brexit uncertainty amid a series of crunch votes in the UK parliament, with Prime Minister Theresa May facing threats from both sides of the Brexit divide.

Meanwhile, the Australian and New Zealand dollars were lower, with AUD/USD shedding 0.47% to trade at 0.7354 and NZD/USD off 0.49% at 0.6755.

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