Dollar rebound pauses as Fed’s Powell strikes prospects of higher interest rates

The dollar’s rebound from a near-three-year low failed after Federal Reserve Chair Jerome Powell said that interest rates would not rise soon.

The release of the details of a $1.9 trillion U.S. stimulus aid failed to support the dollar. The dollar index rallied after hitting its lowest level since 2018 last week, as the prospect of additional stimulus sent the 10-year Treasury yield above 1% for the first time in 10 months.

The dollar index steadied at 90.26 after trading slightly lower overnight. It bounced to as high as 90.73 at the beginning of the week from 89.206 hit on Jan. 6.

The dollar stood at 103.76 against the Japanese yen following a 0.1% slide overnight. The euro dropped 0.1% to $1.21465, on course for a three-day fall. The risk-sensitive Aussie fell 0.1% to 77.650 U.S. cents.