Title: Dollar Down, Ukraine Tensions, Fed Interest Rate Debate Also Drags Euro Down

Feb 15, 2022 12:38AM ET

By: AnalysisWatch

The dollar weakened in Asia on Tuesday morning, while geopolitical tensions in Ukraine weighed on the euro. However, the debate over how aggressively the U.S. should raise interest rates limited the dollar's losses.

The U.S. Dollar Index, which tracks the greenback against a basket of other currencies, fell 0.15% to 96.210 by 12:29 AM ET.

The USD/JPY pair fell 0.19% to 115.31.

The pair AUD/USD declined 0.15% to 0.7115, while the pair NZD/USD rose 0.02% to 0.6616.

The USD/CNY pair declined 0.05% to 6.3542, while the GBP/USD pair rose 0.06% to 1.3535.

The euro was at $1.1308 in early Asian trade, after hitting its lowest level in a week and a half at $1.1278 the previous day. The dollar was just below its two-week high reached on Monday, while cautious moves were also seen elsewhere.

Ukrainian President Volodymyr Zelensky on Monday called on citizens to fly the country's flags on buildings and sing the national anthem together on February 16, the day some Western media are predicting a possible Russian invasion. The remarks startled investors but were meant "sarcastically," according to Zelenskiy's office.

Meanwhile, Federal Reserve officials continue to argue over how aggressively to approach the upcoming rate hikes at their March meeting. St. Louis Fed President James Bullard, who last week called for a significant 50 basis point hike, on Monday, reiterated the call for a faster rate increase.

Bullard's colleagues were more cautious, however, and the Fed will also release the minutes of its latest meeting on Wednesday. The Reserve Bank of Australia released the minutes of its own meeting earlier in the day.