Dollar Slips Back Ahead of Key Fed Minutes Release By

Dollar Slips Back Ahead of Key Fed Minutes Release By

© Reuters

By Peter Nurse — The dollar edged lower in early European trade Wednesday ahead of the release of the keenly-awaited minutes from the last Federal Reserve meeting, with traders looking for clues on the direction of the economy and interest rates.

At 4:04 AM ET (0804 GMT), the , which tracks the greenback against a basket of six other currencies, traded 0.1% lower at 92.483.

was flat at 110.60, rose 0.1% to 1.1831, while rose 0.1% to 1.3812, while the risk-sensitive rose 0.1% to 0.7505.

The dollar received a boost Tuesday as volatility surrounding the price of oil, the Chinese clampdown on the tech sector and a weak ISM non-manufacturing reading prompted a bout of risk aversion.

However, the greenback has since given back some of those gains ahead of the release of the from the Fed’s June 2021 meeting, at 2:00 PM ET (1800 GMT), which are widely expected to offer clues to the central’s bank’s policy outlook moving forward.

“Concerns about a slower recovery after the grim non-manufacturing ISM reading yesterday are inherently tied to Fed’s rate expectations, and some investors may start to feel the danger of a Fed that will have to go ahead with its tightening cycle in 2023 even if the economy is in a more vulnerable state than currently expected,” said analysts at ING, in a note.

“ The FOMC June minutes are therefore set to be watched closely today, with markets weighing carefully the rationale behind the hawkish shift by policymakers.”

Additionally, the May release of , at 10 AM ET, is expected to show 9.4 million vacancies for May, a small increase on the number of vacancies in April.

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