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Dollar slips after FOMC minutes reinforce hawkish, higher-for-longer stance

The Fed’s July 9 read-through pointed to unanimous rate stability and continued concern about persistent upside inflation risks, leaving the dollar unable to extend gains.

Reported · Written up by our desk · Major Pairs

The US dollar traded near the 101.00 area on Wednesday after investors digested the Federal Open Market Committee minutes from the June 16-17 meeting, the first under Fed Chair Kevin Warsh, FXStreet reported. The minutes reinforced a cautious Fed posture, with policymakers agreeing to leave rates unchanged while continuing to see upside inflation risks.

According to FXStreet, several participants flagged factors that could keep price pressure elevated, including stronger AI-related investment, higher tariffs, and renewed tensions in the Middle East. The minutes also leaned toward a higher-for-longer narrative, with some policymakers indicating that another rate hike could become appropriate if inflation follows a less favorable path.

Despite the hawkish signal, the greenback failed to build strong traction as investors weighed softer growth expectations and recent weakness in US labor data, FXStreet said. FXStreet also cited support under EUR/USD, which recovered toward 1.1430 despite the geopolitical backdrop.

In pair trading, GBP/USD rose above 1.3400 to fresh multi-week highs on broad dollar weakness, while USD/JPY stayed supported near multi-decade levels around 162.50 as the yen continued to underperform. AUD/USD was higher near 0.6940 but struggled to gain momentum amid geopolitical uncertainty and upcoming Chinese inflation and activity data, FXStreet added.

Latest closeEUR/USD 1.139 ▼0.1%|USD/JPY 163.85 ▲0.1%|GBP/USD 1.329 ▼0.5%

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