TOKYO — The dollar steadied on Wednesday before a Federal Reserve meeting to determine policy for an uncertain economy and as major investors in Asia continued cashing out of US assets.
News that the United States and China are due to talk on Saturday eased concerns about a trade war that has shaken investor confidence in the dollar and US markets. Fed Chair Jerome Powell was expected to say more data is needed before deciding the US central bank’s next move.
There appeared to be some letup in the selling of dollars since last week, which has been driven by investors globally, particularly in lower-yielding emerging markets, swapping out of the currency or bringing money home.
A record rally in the Taiwan dollar spread outward, driving surges in currencies in Singapore, South Korea, and elsewhere in Asia this week.
Taiwan’s currency has surged more than 10 percent against the US dollar since US President Donald Trump’s April 2 announcement of sweeping tariffs on trade partners. It was 0.65 percent weaker on Wednesday.
The Korean won reached a six-month high at Wednesday’s opening, but subsequently fell.
The yuan weakened as China announced a long-awaited rate cut.
China’s central bank governor said on Wednesday the bank would cut the amount of cash that banks must hold as reserves, the first reduction in 2025, to prop up the world’s second biggest economy amid the simmering trade war.
The dollar index was little changed after slipping 0.2 percent on Tuesday, its third-straight decline. The euro edged 0.2 percent lower to $1.1340, giving up some gains following Friedrich Merz’s election as chancellor of Germany.
