Dollar rises from two-year low on Fed minutes

The dollar gained on Thursday, breaking away from a two-year low after minutes from last month’s Fed meeting prompted bears to buy the greenback in its biggest one-day gain since June. 

The dollar index rose 1% to 92.90 in London trading. The jump following the release of the Fed minutes prompted for the dollar’s biggest one-day gain, according to Refinitv data.

Ahead of the meeting, investors speculated that the Fed will adopt an average inflation target and push inflation above 2% to compensate for the past few years, or cap government bond yields as part of a broader policy review.

However, the minutes only provided vague resolutions on the matter, only stating that “a number” of Fed members thought of revising the statement on its policy strategy. 

The euro dropped below $1.19 and stood at $1.1856. The pound fell 0.25% to $1.3078, while the dollar climbed 0.7% to 106.00 on the yen.

The Aussie fell from an 18-month high to $0.7180, down 72 cents. The kiwi slid nearly 1.3% to $0.6561.