* Graphic: World FX rates in 2020 https://tmsnrt.rs/2RBWI5E
(Recasts with Powell speech, adds data, quote, updates prices)
By Karen Brettell
NEW YORK, Aug 25 (Reuters) - The dollar dipped on Tuesday as investors waited on comments from Federal
Reserve Chairman Jerome Powell on Thursday about the U.S. central bank's policy framework review, and
after data showed improving German business morale.
The major focus for the dollar this week will be whether the Fed's Powell signals that the U.S.
central bank will shift its inflation target to an average. This would allow inflation to rise higher than
previously before the Fed raises rates, which would be a further negative for the dollar.
“The most anticipated conversation is going to be Chairman Powell's speech on Thursday,” said Minh
Trang, senior FX trader at Silicon Valley Bank in Santa Clara, California. "The expectation is that there
might be a subtle shift in how much the Fed will be willing to tolerate higher inflation in the future."
The euro EUR= gained 0.41% on the day to $1.1835, after reaching $1.1965 on Monday, the highest
since May 2018.
The dollar index measuring the greenback against a basket of currencies =USD fell 0.29% to 93.01.
The euro gained earlier on Tuesday after a German business climate index rose more than expected in
August as both manufacturing and services picked up steam, boosting hopes that Europe's largest economy is
set for a strong recovery following the massive coronavirus pandemic shock. It is "another data point that helps keep the euro at this stretched level," said Kit Juckes, macro
strategist at Societe Generale.
Rock-bottom interest rates and concerns about a more dovish inflation policy have reduced the relative
appeal of the U.S. currency, while a relatively high level of COVID-19 infections is also casting doubts
on the speed of the U.S. economic recovery compared with other regions, including Europe.
Data on Tuesday showed that U.S. consumer confidence dropped to a more than six-year low in August as
households worried about the labor market and incomes, casting doubts on the sustainability of the
economy's recovery from the COVID-19 recession. The dollar also weakened against riskier currencies, but gained against the safe-haven Japanese yen
after the United States and China said they are still committed to their Phase One trade deal.
The Australian dollar AUD= rose 0.49% to $0.7196.
The greenback rose 0.36% against the yen JPY= to 106.35 yen.
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Currency bid prices at 3:30PM (1930 GMT)
Description RIC Last U.S. Close Pct Change YTD Pct High Bid Low Bid
Previous Change
Session
Euro/Dollar EUR= $1.1835 $1.1787 +0.41% +5.58% +1.1844 +1.1784
Dollar/Yen JPY= 106.3500 105.9700 +0.36% -2.31% +106.5700 +105.8800
Euro/Yen EURJPY= 125.90 124.94 +0.77% +3.24% +126.0300 +124.9500
Dollar/Swiss CHF= 0.9074 0.9117 -0.47% -6.24% +0.9126 +0.9075
Sterling/Dollar GBP= 1.3145 1.3063 +0.63% -0.86% +1.3169 +1.3056
Dollar/Canadian CAD= 1.3182 1.3216 -0.26% +1.51% +1.3239 +1.3177
Australian/Doll AUD= 0.7196 0.7161 +0.49% +2.49% +0.7197 +0.7152
ar
Euro/Swiss EURCHF= 1.0742 1.0749 -0.07% -1.01% +1.0768 +1.0732
Euro/Sterling EURGBP= 0.9001 0.9021 -0.22% +6.48% +0.9037 +0.8984
NZ NZD= 0.6549 0.6525 +0.37% -2.78% +0.6558 +0.6516
Dollar/Dollar
Dollar/Norway NOK= 8.9508 9.0021 -0.57% +1.96% +9.0123 +8.9277
Euro/Norway EURNOK= 10.5959 10.6160 -0.19% +7.70% +10.6250 +10.5580
Dollar/Sweden SEK= 8.7512 8.7877 -0.03% -6.38% +8.7958 +8.7333
Euro/Sweden EURSEK= 10.3584 10.3612 -0.03% -1.06% +10.3835 +10.3300
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dollar aug 25 https://tmsnrt.rs/3lfXwfQ
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