The dollar traded stronger versus most of its Group-of-10 peers on bets the Federal Reserve may avoid signaling an imminent interest-rate cut.

The Bloomberg Dollar Spot Index pares a 0.2% advance after three days of modest declines; the policy-sensitive Treasury two-year yield is down two basis points to 4.32%.

EUR/USD trades 0.1% lower at 1.0835; it fell 0.4% to 1.0806 after data showed that French inflation eased more than expected in January to reach its lowest level in two years, only to rebound from day lows as German regional CPI data came out.

One-week risk reversals now at 14 basis points, puts over calls, head for most bearish close in six weeks.

Euro down 1.9% on a monthly basis, the most since September.

AUD/USD falls as much as 0.7% to 0.6559 down to leveraged selling on cooling local inflation and shrinking China factory activity.

Aussie now stands 0.2% lower on the day as the dollar loses traction across the board; traders are now pricing in a 70% chance of a Reserve Bank of Australia rate cut in June, up from about 50% on Tuesday.

GBP/USD slips 0.2% to 1.2682; overnight volatility in cable fails to rise to a fresh high for January even as it captures the policy decisions by the Fed and the Bank of England.

USD/JPY reverses modest gains, trades 0.1% lower at 147.46, versus 147.19 day low; the pair is set for a 4.6% gain this month, the biggest since February 2023.

Bank of Japan's summary of last week's meeting signaled it's stepping closer to raising its interest rate for the first time since 2007.

Source : Bloomberg