The U.S. dollar advanced against its peers after Federal Reserve Chair Janet Yellen expressed confidence that the U.S. economy is set to grow.
The euro plunged 0.1 percent to trade at $1.3914, after earlier touching $1.3951, its strongest level since March 13. The 18-nation currency remained slightly unchanged at 141.61 yen. The U.S. dollar rose 0.1 percent to trade at 101.78 yen, a strong showing after earlier tumbling to its lowest level in three weeks.
The Bloomberg Dollar Spot Index, which tracks the dollar against 10 major counterparts, advanced 0.1 percent to 1,002.02, its weakest mark since October 29. The euro tumbled from its strongest level in seven weeks over speculation that the European Central Bank will not announce any additional monetary stimulus in its Thursday meeting.
“Although the dollar is marginally stronger, I do still think the downtrend for the dollar is intact,” Lennon Sweeting, a San Francisco-based dealer with USForex Inc. told Bloomberg. “We’re on a slow boat to seeing normalized rates.”
The Colombian peso surged 0.4 percent to 1,910.41 a U.S. dollar, its strongest in six months, as the market speculated that foreign investment into the country’s bond market.
The price of Colombia’s key peso bonds that expire in 2024 surged 0.26 centavo to 127.25 centavos per peso. The bond’s yields declined 0.03 percentage point, or three basis points, to 6.30 percent.
The peso has increased 6.3 percent since March 18, just before JPMorgan Chase & Co announced it would bolster the weighting of the peso notes, called TES more than two times in two indexes beginning May 30. JPMorgan predicts that foreign funds will invest roughly $9.4 billion owing to the increase. To register for a free 2-week subscription to ForexMinute Premium Plan, visit www.forexminute.com/newsletter.
To contact the reporter of this story; Yashu Gola at email@example.com