The U.S. dollar has rebounded from its recent lows as traders digest the latest Federal Reserve policy minutes, which signal that the central bank isn’t in a hurry to cut interest rates anytime soon. Rather than showing broad consensus on easing, the minutes reveal an internal divide: some Fed officials see scope for future rate cuts if inflation eases, while others are even open to raising rates again if price pressures prove persistent. This uncertainty has underpinned modest dollar strength. 

Beyond monetary policy, heightened geopolitical risk, particularly reports of growing U.S. military posture in the Middle East, has nudged markets toward safer assets, offering additional support to the greenback. 

Major peers like the euro have lost ground, slipping below the $1.18 mark, partly on speculation that the European Central Bank leadership could change sooner than expected, though markets remain unconvinced about the implications of this potential shift. Meanwhile, the Japanese yen has posted slight gains but remains volatile, and Asian trading volumes were lighter due to regional holidays. 

Looking ahead, investors are now focused on upcoming global activity indicators and U.S. GDP releases for fresh direction on growth and inflation trajectories, data that could help resolve some of the uncertainty clouding central bank plans.