The dollar index edged higher to 103.7, a level not seen since mid-December, as traders await the Fed’s monetary policy decision on Wednesday. The Fed is set to keep interest rates steady but the focus will be on any possible hints about the timing and speed of interest rate cuts this year. Bets for a 25bps rate cut in March currently stand at about 49% while the odds for a 25bps reduction in May stand at 50%. The biggest buying activity was against the Euro, as traders raised their bets the ECB will lower borrowing costs as early as April. The greenback also strengthened against the British pound, ahead of the Bank of England’s monetary policy decision on Thursday.
