Conflicting narratives keep dollar rangebound
The trade-weighted dollar flatlined overnight as optimism surrounding China’s reopening process helped offset cautious commentary from Federal Reserve officials. The pound and euro are giving back some of yesterday’s gains as falling inflation prints put pressure on yields, and the Canadian dollar is down slightly on the day – but has gained on a year-to-date basis along with other commodity-linked currencies. Currency markets shrugged yesterday when a record of the Federal Reserve’s December meeting was released, showing that officials thought “substantially more evidence” of easing inflation would be needed before rate hikes could pause. Central bankers warned “an unwarranted easing...