FOREX-Dollar subdued ahead of Fed rate decision

By Ankur Banerjee SINGAPORE, March 22 (Reuters) - The dollar was pinned near five-week lows on Wednesday ahead of the conclusion of the U.S. Federal Reserve's policy meeting, with investors awaiting clarity on the path the central bank is likely to take in the wake of global banking turmoil. Investor attention is zeroed in on whether the Fed will stick to its hawkish path to fight sticky inflation or pause interest rate hikes given recent trouble among banks which has included bankruptcy and last-minute rescues. The U.S. dollar index , which measures the currency against six peers, was at 103.22, just above the five-week low of 102.99 touched overnight. The euro was at $1.0767, hovering around a five-week high of $1.0789 scaled overnight. Markets are now pricing in about a 14% chance of the Fed not increasing rates, with a roughly 86% chance of a 25 basis point hike, showed the CME FedWatch tool. Just a month earlier, the market was pricing in a 24% chance of a 50 basis point hike. Investor sentiment remained fragile with worries over the outlook for the banking sector starting to ease after sharp volatility in the market in the past few weeks following high-profile U.S. banking failures earlier in the month and the rescue of lender Credit Suisse Group AG at the weekend. "Markets are seemingly becoming more comfortable with the idea that authorities have probably done enough to prevent a systemic banking crisis," said Rodrigo Catril, a senior currency strategist at National Australia Bank in Sydney. "It might be early days, but the price action over the past 48 hours is certainly signalling a change in mood by investors." The Fed meeting concludes on Wednesday with the 2 p.m. EDT (1800 GMT) release of a policy statement followed half an hour later by a news conference by Chair Jerome Powell. Catril said the Fed faces a difficult choice given a strong labour market alongside February inflation figures that were higher than many market watchers expected. Such circumstances would usually be ripe for a return to a 50 basis point hike were it not for worries over financial stability, he said. Meanwhile, the yen weakened 0.04% to 132.59 a dollar, whereas sterling was last trading at $1.2221, up 0.06% on the day.

The Australian dollar rose 0.04% to $0.667, while the New Zealand dollar fell 0.16% to $0.618. In cryptocurrencies, bitcoin last fell 0.14% to $28,114.13, below a nine-month peak it touched on Monday. Ethereum last fell 0.47% to $1,793.72.

======================================================== Currency bid prices at 0111 GMT Description RIC Last U.S. Close Pct Change YTD Pct High Bid Low Bid Previous Change

Session
Euro/Dollar $1.0770 $1.0770 +0.00% +0.00% +1.0776 +1.0766 Dollar/Yen 132.4150 132.4900 +0.12% +0.00% +132.6850 +132.6500 Euro/Yen <EURJPY=EB 142.63 142.67 -0.03% +0.00% +142.8700 +142.4500 S>
Dollar/Swiss 0.9220 0.9223 +0.01% +0.00% +0.9224 +0.9215 Sterling/Dollar 1.2220 1.2219 +0.01% +0.00% +1.2227 +1.2213 Dollar/Canadian 1.3707 1.3713 -0.01% +0.00% +1.3718 +1.3710 Aussie/Dollar 0.6679 0.6671 +0.12% +0.00% +0.6679 +0.6662 NZ 0.6189 0.6194 -0.11% +0.00% +0.6195 +0.6173 Dollar/Dollar

All spots Tokyo spots Europe spots Volatilities Tokyo Forex market info from BOJ <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ World FX rates ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^> (Reporting by Ankur Banerjee in Singapore; Editing by Christopher Cushing)

Twitter: @AnkurBanerjee17;))

Reuters

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

off-the-wire

FOREX-Dollar subdued ahead of Fed rate decision

By Reuters

Reuters

Reuters

Gold is never going back to $2,000: 'That's history,' prices to 3x from here – Peter Schiff

‘Biggest economic shift since Nixon’: Major U.S. monetary policy changes coming in 12-36 months – Jack Mallers

India joins South Africa in denying BRICS currency plans after Trump’s 100% tariff threat

Solid price gains for gold, silver after busy news weekend

Bitcoin remains a ‘speculative vehicle’ and ‘won’t work’ as a reserve: ‘I prefer gold’ – Ray Dalio