US Dollar Drops Against Yen as Traders Collect Profits

The dollar retreated as it trailed a drop in the yields of US Treasury notes on Monday. The greenback’s decline followed increased worries that the Organization of the Petroleum Exporting Countries might fail to reach a deal to cut output in a meeting later this week.

Investors reversed some of the US currency’s gains over the past 3 weeks as caution overshadowed trading today, ahead of a busy week for data releases and economic events. Oil producers within OPEC are meeting with non-OPEC producers today to possibly reach an agreement to reduce production, which would be aimed at supporting higher oil prices.

However, Saudi Arabia announced that it will not be attending the meeting, which could prevent OPEC from coordinating any cuts to oil producers’ outputs when the organization holds its meeting on Wednesday in Vienna. Saudi Arabia plays a major role in the oil cartel that controls a third of world oil production.

Back in September, OPEC promised to reduce production after a global oversupply rapidly pushed oil prices down to levels that proved painful for nations dependent on revenues from the crude. Nonetheless, continuous disagreements between major producers within the organization, including Saudi Arabia, Iraq, and Iran, only further increased difficulties faced to reach a deal with major producers outside OPEC, most namely Russia.

While investors closely watch OPEC’s meetings, the United States will have a number of data released this week, which raised traders’ anticipation and further supported collecting profits today from the dollar’s rise. The optimism that followed Donald Trump’s win in the US presidential election seem to have run its course for now.

EUR/USD traded at 1.0593 at 15:20 GMT after touching 1.0673 at 02:35 GMT today, the pair’s highest level since November 17. EUR/USD opened trading on Monday at 1.0604.

USD/JPY traded at 112.48 as the pair declined from 111.42 at 02:35 GMT, a level not seen since November 23. Trading started on the pair today at 112.91.

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