Euro Rose Further on Draghi's Statement

President Donald Trump's struggle to push health care reform through Congress has fuelled fears on trading floors for his market-friendly agendaMore

President Donald Trump's struggle to push health care reform through Congress has fuelled fears on trading floors for his market-friendly agendaMore

The euro stood tall near a 10-month high on Wednesday after the European Central Bank chief hinted the days of the ECB's aggressive stimulus are numbered, and as the dollar was pressured after a vote on United States healthcare legislation was delayed.

German two-year government bond yields dipped 1.5 basis points to minus 0.58 percent, retreating from a one-year peak of minus 0.53 percent hit earlier in the day.

Meanwhile, the US Republicans' struggle to push through controversial health care legislation was fuelling concerns about the chances of President Donald Trump passing his much-vaunted economic agenda, traders said.

The day's gyrations show how focused investors have become on when central banks will withdraw the stimulus that has shaped markets for so many years.

USA stock indexes edged lower in early trading Tuesday, led by declines in phone and utilities companies. U.S. gold futures gained 0.22 percent to $1,249.60 an ounce.

U.S. Federal Reserve Chair Janet Yellen said on Tuesday the central bank would continue raising rates gradually and that "by standard metrics, some asset valuations look high but there's no certainty about that".

Others had cast doubt on how far bond yields could rise.

Japan's Nikkei ended down 0.5 percent, as the yen, at 111.900, also took advantage of the dollar's weakness.

At the same time, core European bonds are the significant area of vulnerability to better euro zone growth and to changes in ECB policy, he added.

The yield on the 10-year Treasury note pared earlier gains to trade at 2.223% recently, according to Tradeweb, having traded above 2.25% earlier in the day. The banking and insurance sectors however outperformed on expectations of higher rates.

A planned vote on Republican healthcare bill to dismantle the Affordable Care Act was put off to after the Senate's July 4 recess.

"These weren't very hawkish comments, as he suggested some changes to policy although the overall stance did not change", said Masafumi Yamamoto, chief forex strategist at Mizuho Securities in Tokyo. The Bank of Canada's Governor Stephen Poloz will speak at a European Central Bank panel. The contract had retreated to a 10-month low of $42.05 a barrel last week before the sharp retreat stalled, but it remained on track for a monthly loss of about 10 percent. US crude futures were down 0.5 percent at $44.04.

Volatility in U.S. equities rose the highest in six weeks as investors digested recent economic data and central bank verbiage. Brent crude, the global standard, lost 1 cent to $46.91 per barrel in London.

"The market got ahead of itself in the first quarter with (hopes for) Trump's infrastructure plans, that's not happening now but against that China growth is ok", said SP Angel analyst John Meyer.

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