Dollar rebounds from 2-year low ahead of Fed meeting

The US dollar rose on Tuesday, to head for the first gain in 8 day, rebounding from the 2-year low hit yesterday. This comes ahead of the US consumer confidence index reading and the Federal Reserve meeting.

The dollar index rose 0.5% to 94.01 points, after opening at 93.58, and hit an intraday high of 93.49.

The index lost 0.75% yesterday, posting its seventh daily loss, and hit a 2-year low of 93.48 points, after the US 10-year treasury bond yield fell.

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

Investors sentiment remains strong in most markets, especially after the EU leaders agreed on an economic recovery fund, and positive news about coronavirus candidate vaccines, in addition to upbeat economic data in most parts of the world.

Investors are anticipating key economic data releases today on the US consumer confidence during July.

At 14:00 GMT, the CB consumer confidence reading will be released, with forecasts to reach 94.0 points in July vs. 98.1 points in June.

The Federal Reserve will launch its meeting later today, and will announce its interest rate decision tomorrow, which is widely expected to be kept unchanged at 0.25%.

Fed chair Jerome Powell will hold a press conference after the meeting  to comment on the decision, which is expected to provide signs on any new stimulus plans and the Fed's future approach.