Dollar Falls as Market Awaits Yellen’s Speech in Jackson Hole

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Dollar Falls as Market Awaits Yellen’s Speech in Jackson HoleThe dollar plunged from 11-month high against the euro ahead of a speech by Federal Reserve Chair Janet Yellen in a meeting of global central bank chiefs in Jackson Hole, Wyoming.

The US dollar fell 0.2 percent to trade at $1.3279 per euro as of 2:15 p.m., New York time. It had earlier surged to $1.3242, its highest level since September 10. The dollar traded at 103.77 yen after appreciating to 103.96, the strongest since April 4. The euro rose 0.2 percent to 137.80 yen.

The dollar rose on Wednesday after minutes of the Federal Reserve’s July meeting revealed that officials may raise interest rates earlier than expected.

“We did get sort of a message from the Fed yesterday and now we have to wait for a follow-up from Yellen, but she’s probably going to stay the course at this point,” Fabian Eliasson, a New York-based FX sales specialist at Mizuho Financial Group Inc., told Bloomberg News. “We really need to get a time schedule from the Fed for a bigger dollar rally to happen.”

The Mexican peso jumped 0.3 percent to 13.0931 per dollar after a report by the national statistics institute showed that the economy grew 1 percent in the second quarter from the first one, when it climbed 0.4 percent. Economists surveyed by Bloomberg had expected an expansion of 0.8 percent.

The Norway’s kronor also rose by the fastest pace after the country’s gross domestic product in the second quarter increased more than expected. Norway’s economy expanded 1.2 percent in the April-June quarter, compared with 0.5 percent in the three months through March. The kronor jumped 0.6 percent to 8.1658 per euro, the biggest advance since August 11. It rose 0.7 percent against the dollar to 6.1493. To register for a free 2-week subscription to ForexMinute Premium Plan, visit www.forexminute.com/newsletter.

To contact the reporter of this story; Jonathan Millet at john@forexminute.com