Dollar dips mildly lower as FOMC minutes left markets confused on the timing of the next rate hike. The minutes for July FOMC meeting showed that some policy makers "preferred to defer another increase in the federal funds rate until they were more confident that inflation was moving closer to 2 percent on a sustained basis." However, "Some other participants viewed recent economic developments as indicating that labor market conditions were at or close to those consistent with maximum employment and expected that the recent progress in reaching the committee's inflation objective would continue, even with further steps to gradually remove monetary policy accommodation."
Meanwhile, there was basically no consensus on the policy path except that more time is needed. The minutes said that "members generally agreed that, before taking another step in removing monetary accommodation, it was prudent to accumulate more data in order to gauge the underlying momentum in the labor market and economic activity." Fed fund futures are pricing in 15% chance of a September hike and 50.3% chance of a December hike. Focus will turn to Fed chair Janet Yellen's speech at Jackson Hole symposium on August 26.
The dollar index dips to 94.38 as the fall from 97.56 continues. Deeper decline would be seen to lower channel line support (now at 94.16). Sustained break there will carry near term bearish implications and would target 91.91/93.01 support zone before looking for a bottom. Though, rebound from the channel support, followed by break of 95.65 resistance will extend the choppy rise from 91.91 through 97.56 resistance instead.
Elsewhere, Australia employment market grew more than expected by 26.2k in July while unemployment rate dropped to 5.7%. Japan trade surplus narrowed slightly to JPY 0.32T in July. Looking ahead, UK will release retail sales in European session. Eurozone current account, CPI final and ECB monetary policy accounts will also be featured. US will release jobless claims, Philly Fed survey and leading indicators later today.