FX.co ★ Dollar Steadies Ahead of Fed Minutes

The dollar index stabilized around 102 on Wednesday after coming under pressure in the previous session, as investors looked ahead to the minutes of the Federal Reserve’s latest meeting for fresh guidance on the monetary policy outlook. Market participants also assessed remarks from Fed officials, with policymakers increasingly signaling a less hawkish stance on interest rates following softer-than-expected PCE inflation and labor market data released last week. Futures pricing now implies nearly an 80% probability that the Fed will leave rates unchanged this month.

At the same time, investors continued to track bond markets after a recent selloff, driven by worries over persistent inflation, rising fiscal risks, and elevated issuance of AI-related corporate debt. In commodities, oil prices moved higher as Iran stepped up attacks on tankers in the Strait of Hormuz and Saudi forces remained engaged in clashes with the Houthis, developments that kept inflation risks and the prospect of further rate hikes firmly in focus.