Investors increasingly fear that the US Fed will soon end its rate hike policy, which will keep the dollar in a weak tone against other major currencies.
Some investors have piled up their euro holdings rapidly this week, overreacting to the Fed minutes. This long-euro position won't last.
Expectations of further increases in U.S. interest rates are partly encouraging investors to take money out from Asian stocks. Fund outflows have been weighing on regional currencies.
When interest rates increase, they have a capital loss. During a time of ECB rate increases, Japanese investors don't want to buy European bonds.
It seems that investors are beginning to think that rises in US interest rates may continue for longer than previously thought, and in line with this view they are likely to continue covering short dollar positions in the near-term.