Dollar Drifts Near Multi-Month Lows as Treasury Yields Ease
The US dollar has been drifting near multi-month lows against major peers, including the euro and sterling, as Treasury yields ease from recent highs. This development comes ahead of the release of minutes from the Federal Reserve's latest policy meeting, which is expected to provide clues on the path of interest rates.
The euro inched up 0.1% to $1.1585, remaining close to a two-month high touched earlier this week, while sterling was a touch higher at $1.3538, holding near a three-month high ahead of British inflation data due later on Wednesday.
Market participants are looking for signs that the Federal Reserve may not follow through with rate hikes as previously anticipated, which could limit the upside for bond yields in the short term. As Harvinder Kalirai, chief global fixed income and currency strategist at Alpine Macro, noted, 'If the Fed does not follow through with the rate hikes that are being discounted, the upside for bond yields should be very limited here.'