The US dollar maintained its recovery momentum on Wednesday, consolidating gains as investors focused on upcoming economic data and the release of the Federal Open Market Committee (FOMC) minutes. After a strong rebound earlier in the week, the greenback hovered near recent highs, supported by cautious sentiment in global financial markets.
Expectations surrounding the FOMC minutes have heightened as traders seek clues on the Federal Reserve’s outlook on inflation and interest rates. A hawkish tone in the minutes could further bolster the dollar, but uncertainty lingers as economic indicators such as retail sales and industrial production data are also set for release.
Risk-sensitive currencies showed limited movement, reflecting a wait-and-see approach by market participants. While the euro and pound pared minor losses, concerns over the global economic outlook weighed on emerging market currencies, providing additional support for the dollar’s safe-haven appeal.
With the dollar stabilizing, attention turns to whether the upcoming data and Fed commentary can sustain the rally. Investors remain cautious, balancing between potential headwinds and the prospect of clearer policy direction from the Federal Reserve.
