Investors Edge as Dollar Holds Steady Amid Tariff Jitters

The U.S. dollar remained steady against major currencies amid concerns over President-elect Trump's tariff promises. Markets await a key U.S. inflation figure, adding to uncertainties. Meanwhile, New Zealand's dollar rose following a rate cut by the Reserve Bank of New Zealand. Investors eye upcoming economic data.

The U.S. dollar held its ground against major currencies on Wednesday as investors scrutinized President-elect Donald Trump's tariff promises, while awaiting a crucial U.S. inflation report expected later in the day. The New Zealand dollar saw gains following the Reserve Bank of New Zealand's interest rate cut by 50 basis points to 4.25%, highlighting a drop in inflation close to the targeted range.

Trump's tariff intentions towards top trading partners Canada, Mexico, and China stirred market concerns, despite some stabilization in reactions later in the day. 'Markets are likely to remain on edge under Trump's second administration due to policy uncertainties,' commented Carol Kong, a currency strategist at Commonwealth Bank of Australia. Against the Canadian dollar, the U.S. currency rose 0.15%, reaching a high not seen in four-and-a-half years.

Approaching the Thanksgiving holiday, market participants cautiously anticipated the upcoming Personal Consumption Expenditures price index release. While the dollar index slightly dipped, the Japanese yen outshined with expectations of a December rate increase in Japan. Meanwhile, the euro and the British pound experienced minor fluctuations, mirroring broader currency market trends.

(With inputs from agencies.)