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Dollar falls in Asia after Fed, Trump-Xi ahead

4/6/2017, 9:47:41 AMBasics of Trading
Dollar falls in Asia after Fed, Trump-Xi ahead

The dollar fell against the yen in Asia on Thursday on a Fed minutesreading that some saw as a bit less hawkish than expected and as uncertainty swirls around President Donald Trump's plans to cut taxes and boot spending.

USD/JPY changed hands at 110.51, down 0.17%, while AUD/USD traded at 0.7570, down 0.01%. Ahead, the Caixin services PMI for March is due with a reading of 53.2 expected.

Minutes from the March Federal Reserve Open Market Committee meeting on Wednesday showed the outlook had changed little since January with further strengthening of the labor market and progress towards the inflation target and that rate hikes are likely ahead in line with a forecast for three this year.

But members were split over whether stronger inflation warranted faster hikes now or a more gradual pace given the persistence of low inflation in the past.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was last quoted yp 0.04% to 100.46.

Later on Thursday, markets will keep close tabs on comments from a summit meeting of Trump and Chinese President Xi Junping in Florida.

Overnight, the dollar traded higher against a basket of major currencies on Wednesday, buoyed by a surge in private sector job creation in March, which overshadowed a slight slowdown in the services sector.

The dollar surged to session highs, after ADP and Moody's Analytics said U.S. private employers added 263,000 jobs for the month. That was well above economists’ expectations of 187,000. The private payrolls report came two-days before the Labor Department releases its much anticipated Nonfarm payrolls reports.

Meanwhile, a separate report from the Institute for Supply Management showed that non-manufacturing activity slowed more than expected to 55.2 from 57.6 in February.