Dollar mostly steady as traders await Trump news conference
By Sam Forgione
NEW YORK (Reuters) - The U.S. dollar was little changed against a basket of major currencies on Tuesday on nervousness ahead of U.S. President-elect Donald Trump's first news conference set for Wednesday, while the Mexican peso hit a record low.
Investors fretted that Trump, who takes office on Jan. 20, could shake markets by taking an aggressive line on issues such as trade policy and relations with China.
The dollar index .DXY, which measures the greenback against a basket of six major currencies, has climbed more than 4 percent since Trump's win on Nov. 8 as investors have bet his promised fiscal expansion will boost inflation and growth, leading to a faster pace of Federal Reserve interest rate increases.
Speculators had boosted net long bets on the dollar for a third straight week in the week ended Jan. 3, data from the Commodity Futures Trading Commission and calculations by Reuters showed on Friday.
Uncertainty ahead of Trump's comments, however, led to muted moves in currency pairs. Analysts also said traders were watching hearings for the Republican president-elect's choices for senior administration posts.
“In order to jumpstart U.S. manufacturing and create a more level playing field when it comes to relative competitiveness, Trump may suggest a weaker dollar policy," said Douglas Borthwick, managing director at Chapdelaine Foreign Exchange in New York.
The dollar index was last up 0.08 percent at 102.010. The index hit a 14-year high on Jan. 3 of 103.820. The greenback fell as much as 0.7 percent against the yen to 115.21 yen JPY=, near Friday's more than three-week low of 115.04 yen.
The euro EUR=, which hit an 11-day high of $1.0626 in early trading, was last down 0.14 percent at $1.0557. Continued...