Dollar Holds Steady Ahead of Fed Decision
The dollar index remained steady around 107.9 on Wednesday as investors braced for the Federal Reserve’s upcoming policy decision, with the central bank widely expected to leave interest rates unchanged.
Market participants will be closely watching Fed Chair Jerome Powell’s remarks and the central bank’s inflation outlook for hints on the timing of any future rate cuts, especially following President Donald Trump’s call for an immediate reduction in borrowing costs.
Traders are also anticipating the release of the PCE price index report on Friday, the Fed's preferred gauge of inflation.
Meanwhile, the dollar saw some gains on Tuesday after Trump issued new tariff warnings targeting key sectors to encourage domestic production. The February 1 deadline for the first round of tariffs against Mexico, Canada, and China, as previously mentioned by Trump, is also drawing nearer.
Source: Trading Economics