NEW YORK: The U.S. dollar fell to its lowest in more than a week on Wednesday as investor nerves about a global trade war abated, while the Japanese yen rallied on the back of strong wage data.
The dollar index, which tracks the currency against six peers , was last down 0.565% at 107.44, having earlier touched its lowest since Jan. 27 at 107.29.
As U.S. President Donald Trump looked set on Monday to impose 25% import tariffs on Mexico and Canada, the dollar jumped as much as 1.3% to 109.88.
It has since fallen around 2% after both Mexico and Canada won a one-month reprieve by beefing up border security, although the U.S. did increase levies on China.
“In particular, the market was relieved that China didn’t hit back overly hard, and that shows that China is willing to tolerate high U.S. tariffs for the time being,” said Adam Button, chief currency analyst at ForexLive.
The euro rose 0.38% to $1.042 after dropping as much as 2.3% on Monday on fears about the global impact of tariffs and a possible extension of levies to the European Union.
