The start of the European market session saw US dollar trading slightly retreat from recorded gains following encouraging producer price index (PPI) data.
The pullback may be influenced by investor vigilance ahead of the announcement of the results of the FOMC policy meeting in the early hours of Thursday morning (3.00 am Malaysian time).
The Federal Reserve (Fed) is widely expected to accelerate its monthly asset purchases to address growing inflationary pressures in the United States.
The question now is, how many reductions will be made each month, and will interest rates start to rise next year?
For now, the current reduction implemented is $ 15 billion and is expected to end in mid-2022. Investors now predict the Fed will increase that amount to $ 25- $ 30 billion.
The dot plot, which the Fed uses to signal the outlook for interest rates, will also be scrutinized by investors if there are policymakers who support a rate hike earlier than expected.
At the time of writing, the dollar index is trading slightly lower at around 96.40 against six other major currencies.
Examining the movements of other major currencies, the euro traded little changed around 1.1270, while the Aussie dollar and the kiwi continued to weaken around their lowest levels since November.
