TOKYO (Reuters) - The dollar was firm against its peers on Friday, having regained traction as the euro slid sharply after the European Central Bank kept to its planned timetable to move away from its accommodative monetary policy.
The dollar index, which measures the greenback’s strength against a basket of six major currencies, stood little changed at 94.743 .DXY. It had risen 0.4 percent overnight to pull away from a two-week low of 94.084.
The euro was virtually flat at $1.1643 EUR=.
The single currency had sunk more than 0.7 percent the previous day after the ECB said it would stay on course to end its 2.6 trillion euro stimulus program this year and keep rates at a record low level through the summer of 2019.
While the euro’s downturn provided the dollar with a significant lift, the U.S. currency was seen to be enjoying support from other quarters as well.
“The dollar is higher across the board and this reflects the lift it is enjoying from fundamental factors, notably higher U.S. yields and higher Wall Street shares amid improving risk appetite,” said Junichi Ishikawa, senior FX strategist at IG Securities in Tokyo.
“The dollar will remain caught between the lift from such fundamental factors and downward pressure from political factors, such as President Trump’s attempts to keep dollar strength in check.”
The U.S. currency was 0.05 percent higher at 111.15 yen JPY=.
The dollar was slightly lower against the yen for the week, during which it pulled away from a six-month high above 113 yen scaled on July 19.
The dollar’s retreat came after U.S. President Donald Trump expressed displeasure over the currency’s strength and amid speculation that the Bank of Japan could scaled back its massive monetary stimulus soon.
The Australian dollar AUD=D3 was a shade higher at $0.7381. The Aussie, often seen as a liquid proxy of China-related trades, had fallen 1 percent the previous day amid a drop in Chinese equities.
Source: Reuters