The US Dollar traded in a tight range on Wednesday, consolidating near multi-year lows as investors awaited the outcome of the Federal Reserve’s monetary policy meeting.
The central bank is widely expected to keep rates unchanged, but focus remains on the updated economic projections and Chair Powell’s tone, which could offer valuable guidance on the trajectory of rates for the remainder of the year.
Although May’s retail sales data disappointed earlier this week, underlying consumer strength and elevated wage growth have helped temper expectations for immediate policy easing.
Markets currently price in two rate cuts by year-end. US Treasury yields were little changed, with the 10-year note holding steady near 4.4%, as traders awaited clarity from the Fed. Meanwhile, tensions in the Middle East remain a key risk factor. With Israel-Iran hostilities entering a sixth day, market sentiment remains fragile.
