The U.S. dollar was dragged further from its best level since July 11 on the previous session against its Japanese counterpart this early Monday. This came in before the unveiling of the delayed tax reform in the United States. Fed’s movement on rate hikes also influenced the greenback.
The U.S. Federal Reserve has left rates as it is on Friday, which is already expected by many. However, it heightened expectations that the central bank will incite an interest rate hike before this year ends as it gave emphasis to the robust employment market and strong economic health in the country.
The latest ADP private employment report on Thursday, which came in higher than expected, gave a sign that supported the mission of Fed to tighten monetary stimulus. However, this movement has limited the gains of the dollar because all the news related to the monetary policy and the economy has been the center of attention.
The U.S. dollar fell more than 0.15 percent against the Japanese yen at 114.030. The greenback rose as high as 0.5 percent overnight, on its way to a 3-1/2-month high of 114.450. It was somehow given a lift by the economic health and positive U.S. figures.
Barclays’ senior strategist Shin Kodata said the U.S. currency was influenced by the released remark of the Federal Reserve, but it has only limited impact because the central bank’s verdict was highly unexpected.