The dollar edged up against the euro yesterday as investor focus turned toward the Federal Reserve, which delivers a post-meeting statement later in the day, while US stocks climbed after strong earnings from Apple.
Worries that Greece's new government is heading for clashes with the rest of the euro zone over its debts weighed on European equities, while shares of Apple, which jumped 7.7per cent, boosted US stocks.
Apple grabbed headlines after it late on Tuesday reported the biggest quarterly profits in corporate history. Boeing also jumped 6.2 per cent after the release of its results.
Investor skepticism is growing that the Fed will raise US interest rates by mid-year, as had been expected. Other majorcentral banks are easing aggressively, while a strong dollar and slumping oil prices are driving down inflation and hurting profits for some US multinationals.
After the Fed's first two-day meeting of 2015, policymakers are likely to restate their “patient” approach to raising rates while voicing faith that the US economy will continue improving. “People will be looking at the ‘patient’ language. I can't imagine it will be changed,” said Ian Lyngen, senior government bond strategist at CRT in Stamford, Connecticut.
MSCI's global share index was off 0.1 per cent while an index of European shares ended down0.1 per cent. On Wall Street, the Dow Jones industrial average was up 51.43 points, or 0.30 per cent, at 17,438.64. The Standard & Poor's 500 Index was up 2.75 points, or 0.14 per cent, at 2,032.30. The Nasdaq Composite Index was up 24.83 points, or 0.53 per cent, at 4,706.33. The euro fell 0.40 per cent to $1.1325 on the EBS trading platform. The dollar rose 0.14 per cent to 0.90385 Swiss franc.
“The bottom line is that for the dollar to resume its upside it needs to take a break. The US stock market, which has been supporting the dollar rally, is starting to struggle,” said David Woo, head of global rates and currency research at Bank of America Merrill Lynch in New York.
Prices on benchmark 10-year US Treasury notes were up 10/32 to yield 1.7888 per cent, according to Thomson Reuters data.
The Singapore dollar skidded to its weakest in nearly 4-1/2 years after the country's central bank eased monetary policy unexpectedly, its first unscheduled change in over a decade.
Oil prices slipped after news US stockpiles surged by nearly 13 million barrels last week. Brent crude oil fell 78 cents to $48.82 a barrel and US crude futures were down $1.36 at $44.87.