Dollar jumps after Fed official's taper talk stirs markets
The dollar jumped from one-week lows on Thursday after a regional Federal Reserve president suggested a faster pace of reducing the U.S. central bank's asset purchases, comments that pushed the greenback toward a key resistance level.
The dollar index, which measures the greenback against a basket of six major trading currencies, was about 0.06% higher just before the remarks by James Bullard, the president of the St. Louis Fed who is considered a hawk on policy.
Bullard said in comments to CNBC that he was skeptical that inflation would moderate and for that reason the Fed needed to start tapering its bond-purchasing program.
The dollar index jumped to above 93, a key resistance level, before easing a bit to trade 0.15% higher at 92.958. On Wednesday, the index had dropped to 92.801 for the first time since Aug. 17.
The euro was down 0.07% at $1.1762.
POWELL EYED
Bullard's comments came as the Fed's annual symposium in Jackson Hole, Wyoming opened, with the highlight expected to be Fed Chair Jerome Powell's speech on Friday. Powell is unlikely to offer few new hints about when the Fed may start to reduce its massive asset purchases, analysts said.
TREASURIES-Yields fade from two-week highs before Powell speech on Friday
U.S. Treasury yields fell from two-week highs on Thursday, a day ahead of a speech by Federal Reserve Chair Jerome Powell, the week's most anticipated event, which will be scoured for any hints on when the U.S. central bank is likely to begin paring bond purchases.
Benchmark 10-year note yields ended little changed on the day at 1.339%, after reaching 1.375% following Bullard's comments, the highest since Aug. 12.
Reference: Reuters
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