05.07.202321:04:00UTC+00Dollar Firm Against Major Counterparts As Fed Minutes Show More Rate Hikes

The U.S. dollar stayed firm against its major counterparts on Wednesday with the minutes from the Federal Reserve's June monetary policy meeting indicating further interest rate hikes this year.

Also, weak data from China and the Euro area helped boost the dollar's safe-haven appeal.

The minutes from the Federal Reserve's June meeting, released Wednesday afternoon, showed most members thought further hikes are on the way, but considering the lagged impact of policy and other concerns, chose to pause after enacting 10 straight rate increases.

The minutes showed the officials felt that "leaving the target range unchanged at this meeting would allow them more time to assess the economy's progress toward the Committee's goals of maximum employment and price stability."

Voicing hesitance over a multitude of factors, FOMC members said a brief pause would give the committee time to assess the impact of the hikes.

The minutes also showed the members disagreed on rate hikes. After the June meeting, all but two of the 18 participants expected that at least one hike would be appropriate this year, and 12 expected two or more hikes.

The minutes said that participants favoring a 25 basis point increase noted that the labor market remained very tight, momentum in economic activity had been stronger than earlier anticipated, and there were few clear signs that inflation was on a path to return to the Committee's 2% objective over time.

In U.S. economic news, the Commerce Department released a report showing new orders for U.S. manufactured goods increased by much less than expected in the month of May

The Commerce Department said factory orders rose by 0.3% in May after rising by a downwardly revised 0.3% in April.

Economists had expected factory orders to climb by 0.8% compared to the 0.4% increase originally reported for the previous month.

The dollar index climbed to 103.39 gaining about 0.33%.

Against the Euro, the dollar firmed to 1.0855 from 1.0880. Against Pound Sterling, the dollar strengthened to 1.2702, gaining from 1.2715.

The dollar is strong against the Japanese currency, fetching 144.69 yen a unit. Against the Aussie, the dollar is trading at 0.6655, strengthening from 0.6692.

The Swiss franc is weak at CHF 0.8988 a dollar, while the Loonie is down nearly 0.5% against the dollar at C$ 1.3285.