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Forex- Dollar Remains Lower On Fed, North Korea News

Published 2018-05-24, 11:22 a/m
© Reuters.  The dollar was lower on Thursday.
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Investing.com - The greenback remained lower on Thursday after an unexpected dovish-tone in the latest Federal Reserve meeting minutes and news that the White House had called off a planned summit with North Korea.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was down 0.20% to 93.72 as of 11:22 AM ET (15:22 GMT).

The White House said in a statement that it would be "inappropriate" to have a planned summit at this time. Trump and North Korea leader Kim Jong Un were set to meet in Singapore on June 12 to discuss possible denuclearization.

The dollar was also held back by Fed meeting notes suggested that while another interest rate hike is warranted, the central bank would accept inflation rising above its target rate for a while.

This was a surprise to investors, who expected that the Fed will increase interest rates and tighten monetary policy in the coming months. The Fed raised rates in March and is expected to raise rates twice more, with a 95% chance of a hike in June.

The dollar was down against the safe haven yen, with USD/JPY falling 0.80% to 109.18.

Meanwhile sterling was higher on Thursday after UK retail sales came in higher than expected, boosting confidence in the economy. GBP/USD rose 0.17% to 1.3370 but was lower from its session high 1.3412.

The euro was also higher, but was held back by economic and political worries in Europe. The EUR/USD increased 0.22% to 1.1721. Elsewhere, the Australian dollar was higher, with AUD/USD up 0.07% to 0.7563 while NZD/USD was unchanged.

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