Dollar fell in European trade on Tuesday against a basket of major rivals, extending losses for the third straight session as US 10-year treasury yields lose ground as well.
The developments come ahead of important US data, which will provide fresh pricing for the likelihood of the first US interest rate cut in March.
Later today, the Federal Reserve is convening for its first policy meeting of 2024, expected to provide clues on the likely path ahead for monetary policies.
The Index
The dollar index fell 0.1% to 103.36, with a session-high at 103.60, after closing down 0.1% on Monday, the second loss in a row on profit-taking, moving off six-week highs at 103.82.
US Yields
US 10-year treasury yields fell by a basis point today, plumbing two-week lows at 4.038% and underpinning non-yielding assets.
The developments come ahead of important US housing prices and consumer sentiment data.
Such data could provide fresh pricing for US interest rate cut potential in March, with the odds currently standing at 47%.
The Fed
Later today, the Federal Reserve is holding its periodic policy meeting, with decisions released tomorrow, expected to maintain rates flat at 5.5%.
The subsequent policy meeting and speech by Fed chair Jerome Powell will play an important role in informing the markets about the future of US interest rates.
US Data
Later today, important data on US housing sector and sentiment will be released, with strong results boosting the case for delaying the timeline of US interest rate cuts this year.
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