Dollar Slips as Fed Rate Decision Looms

The dollar slid 0.3% against the yen on Wednesday as traders speculated about the likelihood of a large Federal Reserve interest rate cut. Meanwhile, U.S. bond yields increased and the British pound rose 0.4%. Market participants are anticipating the Fed's rate decision and its potential impact on monetary policy.

The dollar declined on Wednesday, falling 0.3% against the yen, as traders speculated about the possibility of a significant Federal Reserve interest rate cut. This came even as Treasury yields edged higher and global stocks steadied.

The U.S. currency also lost ground against other major currencies, with the British pound rising 0.4%. Despite these movements, U.S. bond yields increased, with the 2-year Treasury yield up 3.4 basis points to 3.626% and the 10-year yield rising 4 basis points to 3.69%.

The market is closely watching the Federal Reserve's rate decision, expected at 2 p.m. EDT. Currently, financial markets are fully pricing in a 25 basis points rate cut, with a 63% chance of a 50 basis points cut. European stocks and global indices showed mixed movements, reflecting broader market uncertainties.

(With inputs from agencies.)