The U.S. dollar hit fresh three-year lows during Wednesday’s Asian session, even after Jerome Powell was confirmed for a four-year term as the new Federal Reserve chair on Tuesday, in a move expected to continue the country’s growth trajectory.
As of 1:44 p.m. HK/SIN, the dollar was 0.31 percent lower against the yen, trading at 109.95, and breaking below the technically important 110 level for the first time since September 2017. The euro gained against the greenback, trading at $1.2317, while the dollar slumped against the Canadian dollar, the Swiss franc and the Australian dollar as well.As reporte by MarketWatch, the dollar index was down 0.18 percent to 89.95 .DXY.
Investors are veering away from the dollar as positive data out of Europe and Asia indicates that global markets may be shifting away from holding the U.S. at their core. Trump’s very public desire to withdraw the U.S. from key trade agreements is aimed at strengthening the economy from within, but may spell trouble for the dollar. The U.S. has already withdrawn from the Trans-Pacific Partnership, a 12-nation trade deal, and this week a sixth-round of negotiations will be held in Canada to focus on the North American Free Trade Agreement (NAFA), which Trump has also threatened to withdraw from. Still, Trump’s flamboyant statements have been contradicted by some of his party members, giving hope that the U.S. president will proceed with caution rather than the alacrity he’s known for.
“I think he's seeing the big picture a lot better and the possible detrimental situation of what would occur if in fact he would terminate NAFTA,” said Pat Roberts (R-KS), as reported by Forbes.