The dollar posted modest gains on Wednesday, underpinned by a broad rise in Treasury yields.
The 10-year yield stabilized after touching multi-month lows in the previous session, offering support to the greenback.
Markets are in wait-and-see mode ahead of the release of the Federal Reserve minutes, which could set the tone for the next few days.
The backdrop remains mixed as labour market resilience contrasts with softer inflation readings, keeping the path of policy rates in doubt. The uncertainty could leave the market without a clear direction.
Recent Fed commentary has reinforced that ambiguity. Fed Governor Michael Barr suggested policy may need to remain steady while incoming data are assessed.
In contrast, Chicago Fed President Austan Goolsbee indicated that additional cuts could be justified if inflation convincingly trends back toward 2%.
Looking ahead, all eyes are on the upcoming PCE inflation and GDP figures due Friday. Evidence of persistent price pressures and economic strength would validate higher yields and extend dollar support. Conversely, a renewed disinflation surprise could reignite expectations of faster easing, pressuring both the currency and yields.
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