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The minutes of the Federal Reserve's July 25-26 meeting showed
some members called for halting interest rate hikes until it was
clear a softening inflation trend was transitory, but it also
indicated the Fed was poised to begin reducing its $4.2 trillion
portfolio of bonds.
Even though the euro stumbled on Wednesday after sources
signaled European Central Bank chief Mario Draghi would not use
his Jackson Hole appearance to signal policy change by the bank,
investors remain bullish about the currency's outlook.
"Most investors are still relatively underinvested in the euro
and that unwinding is still going on while structural factors
such as the current account surplus for the euro zone is a
strong support for the currency," said James Binny, EMEA head of
currency, State Street Global Advisors based in London.
The single currency was trading slightly higher at $1.1763 in
early trades, nearing a 2-1/2 year high of $1.1910 hit earlier
this month.
The euro has gained 12 percent so far this year against the
dollar and is the best performing currency in the G10 FX space
with most of its gains coming in recent months on growing bets
that the ECB will start unwinding its massive policy stimulus.
The U.S. dollar was also undermined by worries over U.S.
President Donald Trump's ability to implement his economic
policies after he disbanded two high-profile business advisory
councils.
The dollar's index against a basket of six major currencies
slipped to 93.50 from Wednesday's three-week high of 94.145.
(Reporting by Saikat Chatterjee; Editing by Toby Chopra)
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