The dollar is losing positions due to inflation slowdown in the U.S., the focus is on the Fed meeting

Earlier, the inflation data showed lower-than-expected results. Because of this, after a sharp fall, the US dollar barely got a fix on Wednesday. That affected higher expectations from the results of the Federal Reserve System discussions about slowing the pace of rate hikes at 7:00 p.m. Greenwich Mean Time.

Interest rate hikes by 75 basis points have occurred four times in a row. Currently, interest rates are expected to rise by 50 basis points after the two-day meeting of the U.S. central bank.

Carol Kong, a currency strategist at Commonwealth Bank of Australia, joins arguments in support of reducing the pace of interest rate hikes by 50 basis points on the side of slowing CPI inflation.

Kong expects to hear from FOMC Chairman Powell at the press conference about the risks for economic growth and the need to bring inflation down to the target level. In her view, risk assets are positive about the focus on economic growth, which will pull the dollar down.