Dollar edges away from three-week high versus yen; kiwi firm after RBNZ

Thursday,   22-Jun-2017   11:29 AM (IST)

The dollar eased versus the yen on Thursday as a recent rally tied to bets on another U.S. interest rate hike this year lost steam, while the New Zealand dollar rose after its central bank stopped short of aggressively trying to talk down the currency. The New Zealand dollar was the big mover during Asian trade, rising 0.4 percent on the day to $0.7248 , edging back in the direction of a four-month peak of $0.7320 set last week. The kiwi rose after New Zealand's central bank played down the recent rise in the currency, while it kept interest rates steady at record lows as analysts had widely expected. "The main takeaways from the statement were pretty much in line with the last statement. They're still optimistic and positive on the medium-term growth outlook," said Peter Dragicevich, G10 FX strategist for Nomura in Singapore. The U.S. 10-year bond yield is now 209 basis points above its Japanese counterpart, compared to levels around 237 basis points seen in the early part of May. Brent crude oil futures (LCOc1) eased 0.1 percent after sliding 2.6 percent in the previous session. The dollar index (DXY), which measures the greenback against a basket of six major currencies, was marginally weaker at 97.504, having retreated from a one-month high of 97.871 set on Tuesday. The euro was little changed at $1.1168 Last week, the Federal Reserve, as expected, raised key borrowing costs by a quarter point to 1.00-1.25 percent, while Fed Chair Janet Yellen downplayed recent signs of inflation softening. Sterling held steady at $1.2670 , after having risen 0.3 percent on Wednesday when the Bank of England's chief economist, Andy Haldane, said he expected to back a British rate increase this year.