Dollar Halts Slide On Fed Rate Hike Talk

Fahad Shabbir (@FahadShabbir) Published August 17, 2016 | 11:20 AM

TOKYO,(UrduPoint / Pakistan Point News - 17th Augst,2016) - The Dollar halted its slide in Asia trade Wednesday after a senior US central banker said overnight that an interest rate raise could come as early as next month. William Dudley, the influential head of the Federal Reserve's New York branch, unexpectedly hinted that a rate hike was possible as early as September. Analysts said the comments from Dudley -- who remarked that Wall Street investors were too "complacent" about the prospect of higher borrowing costs over the next year -- halted the US unit's fall in Asia. The greenback had briefly dived under the 100 level against the safe-haven Japanese Currency in New York for only the second time this year, touching as low as 99.54 at one stage. "While Dudley was at least able to stem the bleeding for the dollar index, price action is not encouraging for the dollar near term," Sean Callow, a Sydney-based senior foreign-exchange strategist at Westpac Banking Corp.

, told Bloomberg news. "Still, so long as a rate hike seems more likely than not as the Fed's next move, we wouldn't get super bearish on the dollar." In Tokyo morning trade, the greenback climbed to 100.57 Yen from 100.30 yen Tuesday in New York. The euro rose to 113.46 yen from 113.10 yen in US trade, as another Japanese official hinted at a possible bid to weaken the yen. Japan's currency has been on a tear since wild market volatility at the start of the year pushed investors into the currency, seen as a safe bet in times of turmoil. The rally picked up after Britain's vote to quit the European Union sent shivers across world markets.