Dollar dips as bets trimmed before Bernanke testimony
Bernanke is not going to tell anything new that is not already priced in - we can expect a simple whipsaw just for the sake of the change
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The dollar shed some of its recent gains against a basket of currencies on Wednesday as investors trimmed their bets on the currency before testimony from the U.S. Federal Reserve chief.
Ben Bernanke, who testifies to Congress at 1400 GMT, may strike a somewhat optimistic tone on the economy, but with inflation subdued, analysts said he is likely to reiterate that the Fed's ultra-loose monetary policy will stay.
Two senior Fed officials on Tuesday also played down the chances of the bank signalling a readiness to begin winding down its bond buying when it meets next month.
There has been speculation that the recent improvement in the U.S. labour market will drive the Fed to begin reducing its bond buying later this year. That would hurt the dollar although any dips are likely to be shallow given U.S. growth is faster than that in most developed countries.
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