Dollar Down, but Hits 20-Year high over Expectations of U.S. Tightening Policies By


© Reuters

By Zhang Mengying – The dollar was down on Tuesday morning in Asia, but still stood near a fresh 20-year peak as investors look to more aggressive interest rate hikes from U.S. Federal Reserve.

that tracks the greenback against a basket of other currencies inched down 0.03% to 104.930 by 1:04 AM ET (5:04 AM GMT).

The pair edged up 0.17% to 134.63. As the yen fell to 24-year lows against the dollar, Japan Finance Minister Shunichi Suzuki said the government will coordinate any appropriate steps with the Bank of Japan (BOJ) on Tuesday.

“The failure to break through, despite the huge surge in U.S. 10-year yields, is telling,” Spectra Markets Donnelly told Reuters.

“Sell dollar/yen here with a stop at 135.55, looking for a move to 130.55.”

The pair gained 0.40% to 0.6951, and the pair jumped 0.34% to 0.6280.

The pair was down 0.26% to 6.7372, while pair gained 0.35% to 1.2177.

The rose to 8.6% in May year-on-year, a fresh 40-year high. Investors are priced for a 93% chance that the Fed will raise 75 basis points for interest rates at its June policy meeting this Wednesday.

Asian stocks tumbled over the recession worries brought by the policy tightening, following a slip in U.S. equities.

“The market was over-invested in the idea that inflation has peaked,” Societe Generale (OTC:) strategist Kit Juckes told Reuters.

“The policy challenge is that the Fed has no idea how much monetary tightening is needed and will only find out it has done too much, long after the event.”

Moves from central banks to tame global inflation are still on Investor’s radars. will hand down its policy decision on Thursday, while the will hand it down on Friday.

On the data front, the U.S. is due on Tuesday, and China’s is due the day following.

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