The US dollar has weakened against other major currencies ahead of the release of the minutes of the December Federal Open Market Committee meeting scheduled for later today. The US Dollar Index, which tracks the performance of the greenback, was trading in a low range around 102.80 for the better part of the day as investors wait for direction regarding the US dollar from the Fed.
The markets are also expecting the Fed to give direction on the implementation of the three rate-hikes planned for later this year. The Fed are also expected to comment on employment and inflation figures, which are likely to exceed earlier projections.
Although the greenback lost some ground against other currencies, US stocks continue to trade higher as investors remain bullish regarding the performance of the US economy under Donald Trump‘s administration.
The FOMC minutes will shed light on the future direction of fiscal policy in the USA given that an increase in interest yields on Treasury Bills will see the greenback perform well via the USD/JPY currency pair, while a decrease would see the US dollar perform poorly via the EUR/USD currency pair.
The EUR/USD was trading at 1.0476 as at 17:42 GMT having opened the day at a low of 1.0389. The USD/JPY was trading at 117.32 having tested a high of 118.17 earlier in the day.
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