Early trade in New York: Dollar dips from recent peak before Yellen testimony

The dollar slipped against a basket of currencies on Thursday, receding from a 13-1/2 year peak as traders digested prepared remarks from Federal Reserve Chair Janet Yellen and awaited additional comment in her testimony before lawmakers.
Traders were speculating whether Yellen would raise caution about the dollar's spike and a surge in US bond yields after Donald Trump's surprise US presidential win unleashed inflation bets based on tax cuts and federal spending he promised during his campaign.
Before her testimony at 10 am (1500 GMT), the Fed released her prepared speech where she gave a measured view that showed no sign she saw an acceleration in inflation and interest rates next year, even as she pointed to the likelihood of a rise in rates "relatively soon."
"The dollar is mostly softer against the majors, but trading in very narrow ranges," Marc Chandler, global head of currency strategy at Brown Brothers Harriman, wrote in a research note. The greenback's rally "decided to pause, perhaps to wait for additional developments, such as Fed Chief's Yellen's testimony before the Joint Economic Committee of Congress."
The dollar index, which measures the greenback against six major currencies, was down 0.1 percent at 100.30 after hitting a 13-1/2 year high at 100.57 on Wednesday. The dollar pared initial losses following upbeat US data on housing starts which rose to a nine-year high in October and on jobless claims that fell to a 43-year low last week. A renewed selloff in US Treasuries due to the encouraging data also stemmed the dollar's decline.
The benchmark 10-year Treasury yield was up 2 basis points at 2.24 percent, 6 basis points below the 10-month peak set last Friday. The euro was up 0.1 percent at $1.0695, above the 11-1/2 month low of $1.0663 set on Wednesday.