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The US currency continues to dwindle down today as Federal Reserve’s Chair Janet Yellen commented on the current inflation; according to the Yellen, investors may want to lower their expectations of the expected fast-paced rate hikes. The greenback suffered denting blows from over 10 major currencies and hits new record lows.

The dollar index, which measures the dollar’s strength against major currencies, was down at a record low after the Fed’s meeting; the slump hits one of the lowest points since of September last month, this is the same month where Yellen said “there was uncertainty about when and how much inflation will respond to tightening resource utilization”.

According to a senior macro strategist at the Canadian Imperial Bank of Commerce in Toronto, Bipan Rai, “Yellen veered slightly in the dovish direction, which makes sense given the soft inflation readings of late,” and “That implies the USD should continue to trade defensively while U.S. 10-year yields will likely find it difficult to break above 2.40 percent near term.”

While chief market economist at Mizuho Bank, Daisuke Karakama, “If U.S. prices continue to decline, it’ll be hard for the markets to sustain the current mood toward monetary tightening, and some markets are already starting to feel that now,”

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Dollar Dip Data

The dollar losses any gained momentum it had from the beginning of the week, as a matter of fact, the USD/CAD plummets to a staggering 2.3% low of 1.2681.The Canadian dollar continues to pack-a-punch with increasing stream from Poloz’s positive comment on the Canadian economy, this makes the Canadian dollar the top currency among its G-10 peers.

While the USD/YEN manages to cut its positive streak from Yellen and the Fed’s general consensus for the rate hike pace; the USD/YEN fell at a new low of 112.93 just before stopping at a flat 113.00 minutes before the market closes. The decline in the yield from the 10-year Treasure by 2.30% helped on fending off some potential losses the greenback could’ve experienced. This is unfortunate news for the dollar after having a four-month high.

EUR/USD

Another major struggle the dollar needs to fight against is with the euro, the EUR/USD was trading at a 0.2% high to 1.1434. The upbeat data was steered by the new found expectations that the European Central Bank is looking at a hawkish signal with its next meeting next week. 

GBP/USD

The dollar also managed to get beaten with one of its major competitors, the pound; the BGP/USDS was up by a total of 0.1% at 1.2897; the pound is riding the tailwind provided by the comments from the Bank of England’s Monetary Policy Committee member Ian McCafferty.

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