Dollar Weakens Amid Jitters Before Trump's Briefing on Wednesday

  • ‘Slightly scary to build dollar longs,’ Daiwa’s Ishizuki says
  • Fed officials including Yellen scheduled to speak this week

Marinov: Fed Rate Hikes to Help Rally U.S. Dollar

The dollar dropped for a second day against the yen as traders unwound long positions before U.S. President-elect Donald Trump holds a news conference on Wednesday in New York.

The greenback fell versus all its Group-of-10 peers ahead of a slew of U.S. data this week and speeches from Federal Reserve officials including Chair Janet Yellen, which may yield clues on the pace of further policy tightening. Selling flows from Monday are still dominating the market and investors may be cautious about dip-buying at levels around 115 yen per dollar, said Takuya Iwasaki, executive general manager of FX sales at Bank of America in Tokyo.

“Given that so much expectations were built up about Trump’s policies and the fact that the markets are now undergoing a correction, it is slightly scary to build dollar longs,” said Yukio Ishizuki, a senior currency strategist at Tokyo-based Daiwa Securities Co.

  • USD/JPY falls 0.6% to 115.35 after sliding 0.9% Monday; technicals suggest more declines as rate has been below 20-DMA since Thursday; there’s “absolutely no atmosphere” in markets to try USD/JPY’s upside right now, but selling is likely to halt above 115, Daiwa’s Ishizuki said
  • Bloomberg Dollar Spot Index falls 0.3% after declining 0.1% Monday
  • AUD/USD rises 0.3% to 0.7376 after reaching 0.7385, highest since Dec. 15; Australian November retail sales rose 0.2% m/m vs estimate 0.4% gain
  • AUD/USD 0.7400 for A$595m expiring Tuesday; other AUD/USD options expiring Tuesday include strikes 0.7200 for A$1.83b and 0.7300 for A$368m: DTCC
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