Fed Hawkishness Meets Softer Dollar as Europe Surprises

The Federal Reserve's July FOMC meeting minutes revealed a hawkish committee, with three members dissenting in favor of an immediate interest rate hike and most participants agreeing that further tightening would be necessary if inflation didn't moderate.

Labor market conditions were described as stable, but softer labor market data since the meeting has tempered expectations for a September rate hike. The Treasury's move to expand its long-end buyback program also contributed to the dollar's softer tone.

In Europe, activity data surprised to the upside, with the Eurozone composite PMI reaching a nine-month high on strong manufacturing growth and robust German performance.