The dollar rose to its highest level in a week against its G10 peers on Wednesday, rising for the 4th day against the yen and most pairs as investor focus shifted to the minutes of the Federal Reserve’s last policy meeting.
Traders have honed in on is the following language from the statement, in which the BOE raised its growth forecast and said that the monetary policy may "need to be tightened somewhat earlier and by a somewhat greater extent over the forecast period."
"...a slowdown in the service sector comes as a disappointment... the two PMI surveys point to the economy expanding at a reasonably solid, albeit not exciting, 2-2.5% annualised rate at the start of the first quarter."
In the traditional post-payrolls data lull, traders will pay attention to central bank meetings out of the UK, Australia and New Zealand, the US non-mfg ISM and the swearing in of new Fed chair Jay Powell.
Global markets were routed for the second day in a row on Monday, with Asian and European indexes opening lower and bond yields rising as resurgent U.S. inflation raised the possibility central banks would tighten policy more aggressively than had been expected.