The dollar rose broadly on Wednesday, pulling away from a three-year low hit earlier this week against a basket of major currencies, as investors locked in profits in the wake of a relentless slide in the US currency. The dollar climbed against commodity-linked currencies such as the New Zealand dollar and the Australian dollar, which have succumbed to profit-taking after a sharp drop in silver earlier in the week.
The dollar also gained ground against emerging Asian currencies as investors scaled back overstretched positions, and edged higher against the euro. The euro dipped 0.2 percent to $1.4802, pulling away from a 17-month high of $1.4903 hit on Monday on trading platform EBS.
The euro's losses were limited with the European Central Bank (ECB) expected to signal its readiness to raise interest rates after its policy meeting on Thursday, and possibly prepare the market for a June hike. The Australian dollar dipped 0.1 percent to $1.0820. The Aussie's rally has stalled following its climb to a 29-year high of $1.1012 on Monday.
The New Zealand dollar fell 0.7 percent to $0.7924, pulling away from a three-year high of $0.8122 hit on Monday. The dollar rose 0.1 percent against a basket of major currencies to 73.198, pulling away from a 3-year low of 72.722 hit on Monday. The dollar rose broadly against emerging Asian currencies, edging higher against the Singapore dollar and rising about 0.3 percent versus the Malaysian ringgit. The dollar had rebounded after the G7 conducted joint yen-selling intervention in March, in the wake of the dollar's drop to a post-World War Two record low of 76.25 yen. The dollar later hit a six-month high above 85.50 yen in early April, with the Bank of Japan seen as being even less likely to raise interest rats soon than the US Federal Reserve, but has since slipped back close to 80 yen.
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