The greenback regained momentum in the Asian trade. It has been declining for several sessions in a row. It faced bearish pressure after the Fed agreed to swap line arrangements and make dollar injections.

The US dollar dropped across the board. US Treasury notes may also weaken in the near future. However, the greenback appreciated versus its main rivals today. Perhaps an upward reversal was triggered by expectations of a rate hike tomorrow.

The US dollar usually climbs amid the Fed’s hawkish decisions. It was trading at 103.4 in the morning. Although the greenback was moving in the bullish price corridor of 103.3-103.5, it may sink again at any moment.

The yen took advantage of the headwinds in the banking sector. Seeking shelter, investors rushed to buy US government bonds which eventually led to their decrease.

It helped the yen advance versus a weaker US dollar. Yet, its victory did not last long. The greenback spread its wings again. So, the dollar/yen pair was hovering in the range of 131.0-132.2.

In the Asian session, the pair was trading at 131.8, gradually rising. However, bulls seem not ready to give up. They are likely to make attempts to push the price below the important level of 130.

Everything will depend on the results of the Fed’s meeting. The US dollar index is likely to continue trading in a sideways range over the next few days. Traders should pay attention to Jerome Powell’s speech at a press conference.

Due to the 2-week blackout period, Powell has not provided any comments on the banking crisis. So, he is sure to clarify future plans for monetary policy given the current situation. Powell may surprise investors with rather an unexpected decision. This is why one should be ready for certain risks.

If this scenario comes true, volatility will spike significantly. Meanwhile, the RBA meeting minutes published today did not bring any surprises. At its meeting on March 7, the RBA confirmed that it would consider a pause in the monetary tightening in April.

Since May 2022, the Australian regulator has raised its benchmark rate by 350 basis points. For the Australian currency, this is a bearish factor, especially amid a possible rate hike by the Fed tomorrow.

Following the release of the RBA's dovish minutes, the Aussie weakened against other major currencies. The AUD/USD pair broke through the support level of 0.6700. In the Asian session, the pair was moving in the downward channel of 0.6675-0.6726. However, some technical indicators signal an upward reversal despite a retreat.

The New Zealand dollar has no drivers to rise against the US dollar. Despite high volatility and falling stocks, the Reserve Bank of New Zealand said that it saw no immediate need to request reinstatement of the expired US dollar swap line that expired in 2021.

Prime Minister Chris Hopkins urged exporters not to rely so heavily on China, saying it is important for them to diversify in an uncertain world. It means that companies need to expand their range of products and seek new markets.

These remarks caused a fall in the New Zealand dollar. The kiwi/dollar pair slid into the downward range of 0.6186-0.6258. In Asian trade, it was trading at 0.6188. It is likely to keep dropping.


00:00 Intro
00:25 US Fed
01:39 CME FedWatch tool on FOMC rate
02:32 USDX
03:24 USD/JPY
04:05 Jerome Powell
04:41 RBA
05:15 AUD/USD
05:40 NZD/USD


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