U.S. dollar slips as markets await Fed policy meeting

The U.S. dollar slipped on Monday in Asia as traders awaited the upcoming Federal Reserve’s policy meeting.

The central bank’s latest interest rate announcement, due on Wednesday, will be in focus this week. Traders expect no rate changes, but some believe the central bank could flag plans to ease monetary policy later this year.

Central bank meetings in Europe, the U.K. and Japan are also due this week.

“In addition to the upbeat U.S. data, the dollar is supported by weakness in other currencies, notably the euro and antipodeans,” said Junichi Ishikawa, senior FX strategist at IG Securities, in a Reuters report.

“The Fed might cut rates sooner or later but so might its antipodean counterparts as well as the European Central Bank, and such views put the dollar at an advantage.”

The U.S. dollar index last traded at 96.990, down 0.1%. It rose to its highest level in almost two weeks on Friday after the release of better-than-expected retail sales data for May.

The USD/CNY pair was little changed at 6.9238. Chinese data on Friday flashed more warning signs, with industrial output growth unexpectedly slowing in May to a more than 17-year low.

On the Sino-U.S. trade front, U.S. Commerce Secretary Wilbur Ross said he does not expect a major trade deal between President Donald Trump and his Chinese counterpart Xi Jinping at the upcoming G-20 meeting.

“I think the most that will come out of the G-20 might be an agreement to actively resume talks,” Ross said in an interview Sunday with the Wall Street Journal.

His comments came after Trump said on Friday it didn’t matter if Xi attends the summit, adding that China would eventually make a trade deal with the U.S.

The USD/JPY pair gained 0.1% to 108.59.

The AUD/USD pair and the NZD/USD pair climbed 0.1% and 0.3% respectively.