US Dollar suffers as likely increases in US interest rates get pushed back

In terms of data releases, we experienced the busiest day of the week so far on Wednesday. It may have been a busy day for the US Dollar, but not a great one. Poor data all around allowed the US dollar to weaken further against its peers, with the currency falling nearly a cent against sterling. Negative building permits and producer inflation data started the sell-off of US the dollar. This, together with poor industrial production data, had led some banks to re-forecast US growth for the first quarter of this year.

The Federal Reserve minutes of their last meeting reinforced this gloomy picture with policy makers concerned about raising US interest rates too soon and derailing the US economic recovery.

A quiet day is expected today, with the release of the weekly unemployment claims, as well as manufacturing data and crude oil inventories. Despite this, the US dollar could still maintain momentum from the FOMC minutes.