The dollar index (DXY00) on Wednesday fell by -0.16%. The dollar moved lower on Wednesday amid a stronger yuan, which rallied to a 2.75-year high. Also, comments on Tuesday evening by President Trump at the State of the Union address fueled trade uncertainty and weighed on the dollar, as he reiterated his resolve to impose trade tariffs. In addition, strength in stocks on Wednesday reduced liquidity demand for the dollar.
Losses in the dollar were limited amid weakness in the yen, which dropped to a 2-week low against the dollar on Wednesday. Also, higher T-note yields on Wednesday strengthened the dollar’s interest rate differentials.
