The dollar traded on steady grounds on Wednesday, maintaining composure despite US President Donald Trump’s State of the Union address, which touched upon trade and budget matters, but left investors with some surprises.
Against a basket of six major currencies, the US dollar index rose 0.08 percent to $95.898, after almost hitting a two-week high of $96.135.
Senior Market Economist Ayako Sera said Trump’s address did not contain surprises, as he did not, for example, declare a state of emergency (over border funding) nor make surprising comments about China.
During his annual speech on Tuesday, Trump reiterated his promise to put up a border wall to address illegal immigration which he described as an urgent national crisis.
Trump also stated that any trade deal with China must include real, structural change to end unfair trade practices, reduce their chronic trade deficit, and protect American jobs.
The greenback has also been able to maintain its position despite US Treasury yields sliding on Tuesday and withdrawing from one-week highs.
The dollar is managing to draw support in spite of lower Treasury yields thanks to a combination of dovish-sounding Federal Reserve and US data, which has been relatively strong on the whole recently, according to Chief Japan FX and Equity Strategist Shusuke Yamada.
The US 10-year Treasury yield last stood at 2.689 on Wednesday.