The dollar struggled to advance on Thursday even though Federal Reserve policymakers reiterated their commitment last month to fighting inflation, while the Aussie rallied after China eased its restrictions on imports of Australian coal.
overnight showed that while officials agreed that the central bank should slow the pace of its aggressive interest rate increases, they remained focused on curbing inflation, and were worried about any "misperception" in financial markets that their commitment was flagging.on Wednesday that he sees the Fed's target interest rate peaking at 5.4%, higher than current market expectations of just under 5%.
Yet, that failed to give a boost to the U.S. currency, which slid 1.4% against the Canadian dollar overnight. Sterling was last steady at $1.2062, after rising 0.76% against the dollar in the previous session, while the euro edged 0.19% higher to $1.0624, following a more than 0.5% overnight gain. "From the Fed's point of view, it's very, very premature to be thinking about rate cuts in 2023, which is obviously what the market still expects," said Ray Attrill, head of FX strategy at National Australia Bank .
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