The dollar was trading 0.28 percent higher vs the Japanese yen at 105.62 as of 08:50 GMT on Wednesday, with market participants awaiting fresh economic data in search for direction.
From a technical perspective, the 105 level continues to play an important role in the chart. Strong consolidation above it could reinforce bullish positioning with the 110 handle as a medium/long term target.
The US dollar extended its recovery as concerns over a potential global trade war continued to ease during the day. In the previous session, Chinese Premier Li Keqiang said:
“The two economies are highly complementary to each other and their cooperation has been continuously expanding."
Li also reassured China’s position on this matter: a solution through “dialogue and consultation,” although China remains “fully prepared with countermeasures.”
The dollar was also supported by expectations that the Federal Reserve will move forward with a more aggressive interest rate normalization process this year.
The US regulator has recently increased its benchmark rate by 25 basis points, leaving it in a range between 1.50 and 1.75 percent. March’s decisions was Jerome Powell’s first rate hike.
The US dollar index, which measures the greenback against six major currencies, was trading 0.10 percent higher at 88.69 by the time of this writing.
Ahead in today’s session, a fresh look at the fourth-quarter gross domestic product is scheduled at 12:30 GMT, with an upgrade to 2.6 percent expected. At the same time traders await the goods trade balance for Feb. Pending home sales are due for release at 14:00 GMT.