2023.03.2020:34:00UTC+00Dollar Extends Recent Losses

The U.S. dollar drifted lower against its major counterparts on Monday with investors reacting to news about the takeover of Swiss lender Credit Suisse, and the Federal Reserve's announcement about efforts to address turmoil in the banking sector.

The Fed announced that it has joined with other central banks to take coordinated action to enhance the provision of liquidity via the standing U.S. dollar liquidity swap line arrangements helped lift investor sentiment.

European Central Bank President Christine Lagarde's assurance that Eurozone banks have capital and liquidity levels well beyond their requirements contributed as well to the positive mood in the markets.

World's major central banks announced a joint effort to prevent the banking crisis from spreading after the Swiss bank UBS decided to acquire the troubled rival Credit Suisse in a deal brokered by the Swiss authorities.

Traders await the monetary policy announcement from the Federal Reserve. The Fed is widely expected to raise interest rate by 25 basis points on Wednesday.

The dollar index dropped to 103.28, losing more than 0.4%.

Against the Euro, the dollar weakened to 1.0725 from 1.0669.

The dollar is trading at 1.2278 against Pound Sterling, down from the previous close of 1.2179.

Against Japanese currency, the dollar has eased to 131.45 yen from 131.83 yen.

The dollar is weak against the Aussie at 0.6717, drifting down from 0.6701. Against Swiss franc, the dollar has firmed to CHF 0.9289 from CHF 0.9260.

Against the Loonie, the dollar is weak at C$ 1.3665, dropping from C$ 1.3728.