NEW YORK CITY: The dollar firmed against other major currencies on Wednesday (Thursday in Manila) as investors awaited Federal Reserve Chair Janet Yellen’s testimony to Congress Thursday on US economic conditions and monetary policy.
The euro fell to $1.3683 around 2200 GMT, down from $1.3744 late on Tuesday.
The dollar edged up to 102.38 yen from 102.22 yen, while the euro dipped against the Japanese currency, to 140.11 yen from 140.49.
“Investors are buying US dollars today ahead of tomorrow’s testimony from Janet Yellen on monetary policy,” said Kathy Lien of BK Asset Management.
Yellen will appear before the Senate Banking Committee in a hearing delayed by two weeks, because of severe winter weather that has also been blamed as a large factor in a recent spate of disappointing economic indicators.
Analysts were not expecting Yellen, who succeeded Ben Bernanke at the helm of the US central bank on February 1, to deviate from winding down the Fed’s stimulus program, as spelled out in her February 11 testimony in the House of Representatives.
The Fed has cut $20 billion from its asset-purchase program so far this year, to $65 billion a month, and is on track to exit the program before the end of the year if economic conditions hold up.
“We believe that Yellen’s comments will be more beneficial than detrimental to the dollar tomorrow,” Lien said.
“Although new home sales surprised to the upside today, most of the recent economic reports have been disappointing and some investors are hoping that Yellen will acknowledge the deterioration, using it as a justification for keeping monetary policy easy for a longer period of time,” she said.
The dollar rose to 0.8906 Swiss franc from 0.8866 franc late Tuesday.
The pound slipped to $1.6667 from $1.6680.