Volatility among major currencies fell to the lowest since 2007 as global central-bank balance sheets continue growing, driving more liquidity into financial markets, even as the economy worldwide recovers.

Australia's dollar rose the most in almost two weeks against its U.S. counterpart before a report economists forecast will show inflation accelerated. The yuan touched a 14-month low as China's largest manager of distressed debt said the country's soured-loan ratio increased “significantly.” The dollar fell for the first time in eight days against a basket of peers before the Federal Reserve's policy meeting next week.

“The water is becalmed, and here on there's not much that's going to change it,” Marc Chandler, the global head of currency strategy in New York at Brown Brothers Harriman & Co., said in an interview on Bloomberg Radio's “Surveillance” with Tom Keene and Michael McKee. “The Fed is buying more long-term assets than when they first announced QE3 in September 2012. We also know the European Central Bank and Bank of Japan may have to do more, so we're not at the peak of the balance sheets.”