The USD experienced a decline this morning following indications in the US Federal Reserve minutes that, although the central bank is not yet close to reducing interest rates, policymakers are expressing concerns about maintaining rates at excessively high levels.
The minutes from the January meeting reiterated the importance of incoming data, emphasizing that the Federal Reserve must be assured of a sustainable return of inflation to its 2.0% target.
Contrary to market fears, the minutes adopted a less hawkish tone, leading to a decrease in the value of the USD after the announcement. Initially showing strength, the greenback ended up relatively unchanged for the session due to its weakened state post-Fed. The EUR and GBP recorded moderate gains, while the Japanese yen experienced a slight decline.
