The dollar pushed higher against the yen on Thursday after the Trump administration outlined its tax plan and traders awaited the European Central Bank’s monetary policy decision later in the day.
U.S. President Donald Trump’s tax reform plan would cut the income tax rate paid by public corporations to 15% from 35% and make major changes to the individual-tax system.
But the one page plan offered little new information on how it would be paid for without increasing the deficit and is likely to face legislative hurdles.
USD/JPY was up 0.18% at 111.25 by 07.31 GMT, off the one-month high of 111.77 set overnight.
The yen remained steady after the Bank of Japan kept monetary policy on hold on Thursday, in what was a widely anticipated decision.
The euro edged up 0.07% to 1.0911 ahead of the upcoming ECB monetary policy decision, with investors waiting to see if the French election results will have any impact on the banks policy stance.
The euro was also higher against the safe haven yen, with EUR/JPY rising 0.25% to 121.39.
The euro has risen around 3.7% against the yen so far this week and added 1.6% against the dollar as the first round results in the French presidential election eased concerns over political risk in the euro area.
The Canadian dollar surged higher against its U.S. counterpart, with USD/CAD shedding 0.43% to trade at 1.3559 following reports that President Trump has agreed not to terminate the North American Free Trade Agreement at this time.
The Mexican peso was also sharply higher, with USD/MXN falling 0.85% to 19.01.
The loonie and the peso weakened sharply late Wednesday after report that the U.S. was considering pulling out of NAFTA.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was steady at 98.82, off Wednesday’s highs of 99.20.[:]