Cautious Trading on The Dollar Due to Uncertainty About The Fed Meeting

The dollar settled near multi-week highs as traders exercise caution ahead of a two-day Federal Reserve policy meeting that is likely to hint at plans to start tapering bond purchases.

So far, Fed officials led by Chairman Jerome Powell have stressed that the increase in inflationary pressures is temporary and that the ultra-loose monetary policy will continue for some time. But recent economic data is raising concern that price pressures may prompt an early withdrawal of stimulus.

The dollar index fell in the session in Asia, it had risen 0.06% to 90.54, hovering near its highest level in weeks. The euro settled against the dollar at 1.2122 dollars, slightly higher than the lowest level in a month at 1.2093 dollars, which it recorded last week.

The pound lost about 0.2% against the dollar at $1.4077.

Bitcoin fell just below the $40,000 level today and traded below its 200-day moving average, after being bolstered by a new investment pledge from a big supporter, Micro Strategy, and Elon Musk.