Dollar hits 2-year low ahead of Fed decisions

The US dollar fell on Wednesday, to hit a 2-year low, and resume losses after taking a breather yesterday, on growing doubts about the US economy recovery from the coronavirus crisis, ahead of the of the conclusion of Federal Reserve meeting and the reveal of its decisions. 

The dollar index fell 0.7% to the lowest since June 2018 at 93.40 points, after opening at 93.75, and hit an intraday low of 93.80.

The index gained 0.1% yesterday, posting its first daily gain in 8 days, and taken a breather after it hit a 2-year low.

The greenback posted its largest weekly loss in 4 months during the past week, due to weak demand and strong investors sentiment.

The US is still fighting to contain the spiking coronavirus infections, which raised doubts about the economy recovery from the coronavirus crisis, amid the need for more stimulus to overcome the worst crisis since the 1930s Great Depression.

The Federal Open Market Committee is wrapping up its policy meeting today, expected to maintain rates unchanged at 0.25%. 

The US monetary policy statement and interest rate decision will be unveiled at 18:00 GMT, and Fed Chairman Jerome Powell will deliver a speech at 18:30 GMT.

Investors are anticipating insight on whether the Fed will extend its purchases of long-term debt, or target a higher level of inflation in the coming period, which is expected to put pressure on the US dollar.