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Dollar Up, But Near One-Week Low as COVID-19 Concerns Ease By Investing.com

Dollar in Narrow Range as Fed Officials Continue to Downplay Inflation Fears


© Reuters.

By Gina Lee

Investing.com – The dollar was up on Thursday morning in Asia but remained near a one-week low as concerns over COVID-19’s impact on the global economic recovery receded. Investors also await the U.S. Federal Reserve’s Jackson Hole symposium for clues on an asset tapering timeline.

The that tracks the greenback against a basket of other currencies inched up 0.08% to 92.903 by 11 PM ET (3 AM GMT).

The pair was steady at 110.

The pair edged down 0.13% to 0.7264 and the pair edged down 0.17% to 0.6960.

The pair inched up 0.08% to 6.4809 while the pair inched down 0.03% to 1.3755.

The FDA’s full approval of the Pfizer (NYSE:) Inc/BioNTech SE COVID-19 vaccine earlier in the week, which could boost U.S. vaccination rates, improved investor sentiment. Moderna (NASDAQ:) Inc could be next to receive full approval, which could happen within weeks.

The Fed’s Jackson Hole symposium will open later in the day, with Fed Chairman Jerome Powell due to speak on Friday. Signals that the Fed will begin asset tapering within 2021 had boosted the U.S. currency to a nine-and-a-half-month high of 93.734 during the previous week, but it remains to be seen whether the central bank will provide a timeline for asset tapering and interest rate hikes.

In Asia Pacific, became the first major Asian economy to hike interest rates since COVID-19 began. interest rate for August, handed down earlier in the day, is 0.75%, up by 25 basis points from the previous 0.5% and within expectations.

Some investors remain optimistic about the dollar as Fed asset tapering also moves towards becoming a reality, even if it is delayed by COIVD-19 uncertainties.

“While this would be a dollar negative factor on the one hand, COVID-19 Delta worries may simultaneously increase the safe-haven appeal for the dollar,” Rabobank strategist Jane Foley said in a note.

“On balance, while pullbacks are likely to be par for the course, we see scope for euro/dollar to head towards $1.16 on a six-month view,” the note added. The dollar was $1.1765 against the euro on Thursday, little changed after falling to a one-week low of $1.1775 the day before.

 

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