Jul 26, 2022 03:09AM ET
By: AnalysisWatch
On Tuesday, the dollar remained steady below its two-year high as traders analyzed a host of reports and data to gain insight into the direction of the economy ahead of this week's Federal Reserve interest rate decision.
The dollar index, which measures the value of the greenback against a basket of other major currencies, was trading 0.07 percent lower at 106.285 as of 2:39 a.m. EDT.
The dollar recently hit a 20-year high of 109.290 in mid-July.
Today marks the start of the Fed's two-day policy meeting.
There is widespread expectation that the U.S. central bank will raise interest rates by at least 75 basis points in an attempt to rein in rapidly rising inflation.
However, the recent softening in economic data has led some traders to ponder whether the Fed may eventually abandon aggressive policy tightening to avoid hurting growth.
Late Monday, a profit warning from retail giant Walmart also weighed on sentiment. The company said their customers have cut discretionary spending.
Meanwhile, the euro rose slightly against the dollar, up 0.06% to $1.0226. But the common currency still faces headwinds from new uncertainty over Russian gas supplies.
The British pound also gained against the dollar today, rising 0.14 percent to $1.2058.
Investors are considering the Bank of England's policy decision next week, with the central bank expected to raise borrowing costs by up to 50 basis points.
The Australian dollar retreated slightly after hitting a one-month high against the dollar and was trading at $0.6957.
Key Australian inflation data is due on Wednesday, with economists forecasting core consumer price growth will reach its fastest pace in more than 30 years.