Dollar Dilemma: U.S. Currency Hits Multi-Year Low Amid Fed Rate Cut Speculation

The dollar hit its lowest levels in over three years against the euro and sterling as investor speculation grows over potential interest rate cuts by the Federal Reserve. Traders are betting on more aggressive monetary policy easing.

Federal Reserve Chair Jerome Powell's recent comments to Congress have been interpreted as dovish, suggesting the possibility of rate cuts sooner rather than later. Analysts say a July rate cut could be on the horizon if inflation does not accelerate.

Meanwhile, President Trump plans to nominate a new, more dovish Fed Chair next year, potentially impacting monetary policy. As international investors shift focus away from U.S. assets, the dollar faces additional downward pressure.

(With inputs from agencies.)