Investing.com – The U.S. dollar was flat on Tuesday in Asia as investors waited for the Federal Reserve to deliver its latest monetary policy decision.
The that tracks the greenback against a basket of other currencies last traded at 96.545 by 11:56 PM ET (04:56 GMT), little changed for the day.
With the Fed widely expected to deliver its fourth rate hike of the year at the conclusion of its two-day policy meeting on Wednesday, markets were focusing more on the central bank’s monetary policy outlook for the coming year, with many analysts predicting a more dovish outlook.
In September, the Fed projected three rate increases for next year, but some are expecting the Fed policymakers to signal just two rate hikes for next year as global growth continues to show signs of moderating.
“We are expecting a dovish hike by the Fed. The data has not been tepid enough for the central bank not to hike in December,” said Rodrigo Catril, senior currency strategist at NAB.
U.S. President Donald Trump said in a tweet overnight that it was ‘incredible’ that the Fed is even considering raising rates given the recent signs of weakness in the global economy.
was also flat at 6.8975 as investors kept a close watch on a major speech delivered by Chinese President Xi Jinping on Tuesday morning on the 40th anniversary of China’s “reform and opening up.”
“No one is in a position to dictate to the Chinese people what should or should not be done,” Xi said during the address. He then called for China to “stay the course” on its current path of reform.
The People’s Bank of China (PBOC) set the yuan reference rate at 6.8854 vs Monday’s fix of 6.8908.
The yen rose against the U.S. dollar, as the pair edged down 0.3% to 112.53 after Japan’s Cabinet Office revised down its economic growth forecast for 2018 to 0.9% compared with the previous projection of 1.5% increase. In fiscal 2019 the economy will expand 1.3%, also down from the previous forecast of 1.5% growth, it added.
The pair rose 0.2% to 0.7191 as the Reserve Bank of Australia struck a slightly dovish tone in the minutes of its last policy meeting this year.
“The outlook for household consumption continued to be a source of uncertainty because growth in household income remained low, debt levels were high and housing prices had declined,” the central bank said Tuesday in Sydney. “Members noted that this combination of factors posed downside risks.”
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