TOKYO (APP) – The dollar lost ground for a second day Tuesday in line with a fall in Asian shares, as concerns about the global economy clouded the outlook for a long-awaited US Federal Reserve rate hike.
In Tokyo trade, the dollar weakened to 120.62 yen from 121.24 yen late Monday in New York.
The euro was mixed at $1.1269 and 135.93 yen from $1.1213 and 135.95 yen in US trade. Investors are looking for clues as to when the US Federal Reserve will raise its near zero interest rates for the first time in almost a decade, after officials gave no clear signal at a weekend conference.
China’s shock devaluation of its currency last month, combined with signs of slowing growth in the world’s number two economy, have raised more questions about whether the US economy is ready for higher rates.
“Currencies are still taking directional cues from the daily yuan fixing as well as the performance of Chinese equities — and what that means for risk appetite,” Sue Trinh, head of Asia foreign exchange strategy at Royal Bank of Canada in Hong Kong, told Bloomberg News. “Dollar-yen’s price action is dragging the dollar down in general.”