The dollar was trading at 100.62 against a broad trade-weighted basket of its peers and is down almost 3.5 percent from a near 15-year peak of 103.82 hit on January 3.
It was trading at 1.2331 against the dollar, giving back some of its near 3 percent gains scored in the previous session. Lastly, yen and euro weakness against the dollar is partly why we recently upgraded our views on Japanese and eurozone stocks. As the dollar weakens, a safe-haven bid is going into Treasury bonds, pushing down yields, and thus, the main reasons folks have been piling into these stocks. "Some investors have started to take profits, which has led to the sharp fall of the United States dollar against other currencies including the yuan", Lo said.
U.S. President-elect Donald Trump signaled in an interview published Tuesday that his incoming government may break with the policy of maintaining a strong dollar.
Investors were also rattled after Mr Trump said he was preparing to unveil a plan to overhaul President Obama's Affordable Care Act.
But Trump's latest comments signal the new administration prefers a weaker dollar to spur trade and bring jobs back to the USA, a policy that is at odds with fiscal-stimulus proposals that would tend to prop up the currency, according to Woo.
The strong dollar is 'killing us'
"The recent strengthening of the dollar will put downward pressure on import prices and limit the ability of domestic producers to raise their prices", he said. Traders are anticipating him to make some significant decisions immediately that could affect financial markets and this could throw up some big trading opportunities in markets like USD, Gold, Wall Street and a host of individual stocks. A strong dollar lowers costs for the importers and outsourcers he says have taken American jobs.
"But Junya Tanase, chief forex strategist at JP Morgan in Tokyo, said that if US officials further talked down the dollar, "(it) could weaken and the correlation to the interest rate differentials may end".
Various estimates of the dollar's fair value, based on economic fundamentals, now find it about 15% overvalued.
The won climbed as much as one per cent against the U.S. dollar, while the Malaysian ringgit advanced 0.4 per cent.
The strong dollar also keeps the Treasury Department's borrowing costs low, meaning that when the U.S. borrows more money or rolls over existing debt, less federal spending is dedicated to interest payments than would be under a weak dollar scenario.
Are Gigi Hadid, Zayn Malik engaged?
Her appearance comes just weeks after reports suggested she "didn't feel ready" when Malik asked her to marry him. Regardless of whether Malik has talked her into accepting his proposal, he and Hadid are definitely going strong.