The dollar was little changed, while the Japanese yen slipped on Wednesday after climbing overnight following reports that U.S. President Donald Trump’s longtime lawyer Michael Cohen admitted to making illegal payments and committed other crimes to influence the 2016 election.
The U.S. dollar index, which tracks the greenback against a basket of other currencies, edged 0.01% higher to 95.14 by 12:35AM ET (04:35 GMT).
The dollar was under pressure on Tuesday after Trump said he is “not thrilled” about the Federal Reserve’s decision to raise rates.
On Tuesday, Cohen pleaded guilty to eight counts related to tax fraud, excessive campaign contributions, making false statements to a financial institution, and unlawful corporate contributions. While he did not name Trump directly during the hearing, his attorney Lanny Davis said shortly afterward that "Donald Trump directed [Cohen] to commit a crime by making payments to two women for the principal purpose of influencing an election." The Justice Department confirmed late Tuesday that Trump was the unidentified candidate.
Reports that U.S. and China would hold low-level trade talks provided some support for the dollar earlier in the week as it calmed market nerves and reduced demand for the greenback and other safe-haven assets.
Looking ahead, minutes of the Federal Reserve policy-setting meeting is due later today, as markets are likely to focus on whether Chairman Jerome Powell would drop clues on future rate policies when he speaks Friday at the Kansas City Fed’s annual gathering in Jackson Hole, Wyoming.
Elsewhere, the USD/JPY pair gained 0.2% to 110.44. The USD/CNY pair slid 0.1% to 6.8439 as the Chinese yuan headed for its fifth straight session of gains.
The New Zealand dollar climbed to a two-week peak of 0.6772 after strong domestic second quarter retail sales data suggested the gross domestic product would overshoot the central bank's forecast.
