European session review: USD edges higher ahead of U.S. annual payroll revision, Fed’s July meeting minutes

USD rose slightly against most of its major counterparts in the European session on Wednesday as investors waited for revisions to U.S. jobs data and the minutes from the Federal Reserve’s latest meeting, which could prompt a revision of interest rate expectations. 

The U.S. Dollar Index (DXY), measuring the U.S. currency's value relative to a basket of foreign currencies, increased 0.05% from the previous close to 101.49.

The release of the revisions to the U.S. employment statistics for April 2023-March 2024 is due at 14:00 GMT, and the release of the minutes for the July 30-31 Fed meeting is to come at 18:00 GMT.

A noticeable downward revision of earlier announced payroll data would indicate that the U.S. labour market might not be as robust as earlier believed. This, in turn, would heighten recession concerns and might influence expectations of the Fed’s policy easing this year.

Meanwhile, the minutes from the Fed’s July meeting are expected to reveal the policymakers’ views on the economy and inflation, as well as, to hint at their policy plans. 

According to CME FedWatch, markets are currently pricing in a 69.5% probability that the U.S. central bank will cut its interest rates by 25 basis points and a 30.5% probability of a more aggressive move of 50 basis points.