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Hong Kong — The dollar suffered fresh losses yesterday as Asian investors followed their New York counterparts in shifting out of the unit, unmoved by another interest rate hike and an upbeat assessment of the world’s top economy.

The greenback sank after the much-anticipated central bank meeting, which provided little to excite buyers, despite tentative hopes US lawmakers are on course to push through market-friendly tax cuts.

The Fed lifted borrowing costs as expected and said economic growth would be stronger than initially forecast, while inflation would also improve. It also said its projections for three more rate rises next year were on course.

However, Marvin Loh, senior global market strategist at Bank of New York Mellon, told Bloomberg News: “Markets are generally interpreting the meeting as a dovish hike.

“The improved view in 2018 may be driven by tax reform, which will not have a long-lasting impact.”

A below-par reading on inflation added to selling in the dollar, which retreated against most other currencies in New York. It fell through the ¥113 mark, while the pound was above $1.34 and the euro broke $1.18.

And in Asia it continued to struggle, while the Australian dollar surged 1.5percent against the greenback, supported by a better-than-expected jobs reading from Canberra.

There were also healthy gains for the South Korean won, South African rand and Mexican peso.

Greg McKenna, chief market strategist at AxiTrader, said the weakness in the dollar “suggests (investors) don’t believe the Fed’s outlook nor its rate projections”.

Adding to nervousness among traders was the Republicans’ shock loss in the Alabama senate election, which narrowed their majority to just two – fuelling concern that Donald Trump will struggle to push through many of his promised reforms.

However, there is hope his much-vaunted tax cuts will pass through before the Democrats’ newest senator takes his seat.

Reports said Wednesday that Republicans in both chambers of Congress had reached an agreement in principal on the massive tax bill, setting the stage for its final passage next week.

Equity markets were mixed in Asia, brushing off another record for the Dow in New York.

Tokyo ended the morning 0.1percent lower as exporters were weighed by a stronger yen, while Shanghai dipped 0.2 percent and Singapore shed 0.6 percent. — AFP.