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Wednesday, January 19, 2022

Dollar steady as eyes on Fed announcement

TOKYO: The dollar remained steady against the yen on Wednesday as investors waited for a policy announcement by the US Federal Reserve.

The dollar bought 121.32 yen in Tokyo trade, compared with 121.34 yen in New York late Tuesday.

The euro edged up to $ 1.0608 and 128.69 yen from $ 1.0590 and 128.51 yen in US trade after German data showed investor confidence rose to a 13-month high in March.

The US central bank’s decision-making Federal Open Market Committee (FOMC) is to wrap up a two-day meeting on Wednesday, with Fed chair Janet Yellen set to hold a post-meeting press conference.

Investors were waiting for it, hoping to find clues about what could be the first interest rate increase in nearly nine years.

Many Fed watchers anticipated the FOMC will delete its reference to being “patient” — used in the December and January statements — about raising near-zero rates in its post-meeting statement Wednesday.

The dollar has risen sharply recently on expectations of a US rate hike as early as in June.

“The FOMC meeting is now underway, and whether the accompanying market backdrop is a direct reflection of nervousness over the outcome, or rather may actually feed into it, is hard to say,” National Australia Bank said in a note.

Yellen has said that once that “patient” language is removed, a rate hike could come within two FOMC meetings, but that the decision to lift would be dependent on economic data.

Copyright AFP (Agence France-Presse), 2015

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