3 Minutes to Read (Reuters) – SINGAPORE (Reuters) – On Thursday, the dollar fell from recent highs after Federal Reserve chair Jerome Powell reiterated that the central bank was not in a hurry to tighten policy, though losses were limited by investor concerns ahead of Chinese GDP data. PHOTO FROM THE FILE: A banker counting currency at a bank in Westminster, Colorado, counts out four thousand dollars. Wednesday, November 3, 2009. Rick Wilking/REUTERS Powell said overnight that strong inflation appeared to be tied to the Fed’s policy, that acting prematurely to moderate it would be a mistake, and that slowing bond purchases was “still a ways off.” The dollar fell from a three-month high versus the euro and a one-week high against the yen as a result of the comments, but it quickly recovered in the Asia session as traders awaited Chinese data to see if it showed a slowdown. China’s unexpected loosening of monetary policy last week has fueled suspicion that the country’s quarterly growth results, due at 0200 GMT, will be weak, despite trade data beating expectations on Tuesday. “The market is still on an unclear road,” said Rodrigo Catril, a strategist at National Australia Bank. “Investors aren’t persuaded Powell can keep policy ultra-easy, nor are they certain about the trajectory of recovery as the coronavirus mutates.” “The dollar dynamic appears to be overwhelming the dynamics of different currencies,” he said, adding that the dollar dynamic is driven by data and the spread of the delta variation. He went on to say, “The major experiment is really the full reopening in the UK.” “We believe it will be a major influence in terms of confidence and pricing a broader and sustainable recovery,” which might depress the currency if it is successful. Even stark variations in tone between Powell and other central banks charting speedier paths away from ultra-easy policy haven’t pushed major currencies out of current ranges versus the dollar. The New Zealand currency, which had its best day in almost five months overnight, has barely risen to its highest level in a week and is trading below its 200-day moving average, despite the central bank’s announcement that bond purchases will finish next week. The kiwi had pulled back marginally in morning trade, trading at $0.7023. At $0.7474, the Australian dollar was somewhat weaker. The yen held overnight gains to hit a one-week high of 109.88 per dollar. To $1.3840, sterling fell below its 20-day moving average. In offshore trade, the Chinese yuan dropped from a one-month high and was last at 6.4613 per dollar. China’s quarterly growth is expected to be 1.2 percent, with year-on-year growth of 8.1 percent, according to economists polled by Reuters. Tom Westbrook contributed to this report. Gerry Doyle did the editing./n
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