Feb 16, 2022 02:51AM ET
By: AnalysisWatch
The US dollar fell on Wednesday, continuing the sell-off from the previous session, as news of the withdrawal of some Russian troops from the Ukrainian border removed some of the geopolitical risk premium from the market.
At 2:55 a.m. EDT, the dollar index, which tracks the greenback against a basket of six other currencies, was trading 0.1% lower at 95.900 after falling 0.4% on Tuesday.
The change in risk sentiment followed Russia's announcement that it would return some of its troops stationed near Ukraine to barracks after the end of exercises.
The EUR/USD currency pair rose 0.1% to 1.1365 after gaining 0.5% the previous day. The USD/JPY rose 0.1% to 115.67, with the safe-haven yen weakening after briefly reaching 114.99 on Monday, while the riskier AUD/USD rose 0.3% to 0.7169.
However, the dollar's losses are relatively small. NATO Secretary-General Jens Stoltenberg warned that the military alliance shows no signs of de-escalation by Russia while Ukraine suffers a cyber-attack on its defense ministry and the online networks of two banks.
Moreover, traders were wary of getting out of the dollar entirely ahead of the release of the minutes from the Federal Reserve's latest meeting, where policymakers were likely to discuss raising interest rates at their March meeting.
Elsewhere, GBP/USD rose 0.2% to 1.3558 after UK consumer prices rose 5.5% in January, the most in almost 30 years (up 5.4% in December).
Commodity prices fell 0.1% to 6.3350 after inflation in China slowed to its lowest level in six months in January thanks to government restrictions.
The Producer Price Index rose 9.1% y/y, slower than the 10.3% rise in December 2021, while consumer prices rose 0.9% y/y versus a 1.5% rise in December.
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