Dollar edges lower after Fed minutes

Yesterday, the US Dollar slipped against its peers, after minutes from the Fed’s latest meeting suggested that some central bankers are still concerned about persistently low inflation. The Fed minutes on Wednesday showed many policymakers still felt that another rate increase this year “was likely to be warranted” but several noted that additional tightening was dependent on upcoming inflation data. Chicago Fed President Charles Evans is advocating a wait and see approach for the next round of interest rate hikes as the Fed normalizes its expansive monetary policy. Meanwhile, San Francisco Fed President John Williams expects the Central Bank to raise rates later this year, and three times next year.

Meanwhile, the Canadian Dollar climbed to a one-week high of $1.2436 against its US counterpart, as Oil edged higher and after minutes from the latest Federal Reserve meeting weighed on the greenback. Oil prices, one of Canada’s major exports, rose for the third day as the OPEC countries forecast higher demand for 2018 and said that production cuts by producing nations were clearing the global Crude glut.

The Mexican Peso stood firm at 18.688 Pesos per Dollar. It had gained 0.7% overnight to pull away from a five-month low of 18.852, although the currency was seen coming under renewed pressure if the ongoing NAFTA talks run aground. The United States, Mexico and Canada have negotiated this week to reform NAFTA. There are concerns that US President Donald Trump could opt to withdraw from the pact if his demands for more favourable treatment are not met.