NEW YORK: The US dollar edged higher against major currencies on Thursday after traders discounted Wednesday's cautious minutes from the latest Federal Reserve policy meeting, while optimism for a Greece debt deal limited the euro's losses.
The dollar rebounded against the yen and hit a more than one-month high against the Swiss franc after traders reverted to the view that the Fed could hike rates by June, despite the minutes showing officials were concerned that raising rates too soon could damage the U.S. economic recovery.
Analysts said the minutes were somewhat dated since they reflected the Fed's thinking before the release of a stronger-than-expected U.S. payrolls report for January.
"There's a reconsideration in terms of the extent to which the minutes were suggesting that June was being taken off the table," said Alan Ruskin, global head of currency strategy at Deutsche Bank in New York. "There is just generally a wariness to go against what is still seen as a strong dollar trend."
The euro weakened after Germany rejected Greece's request for a six-month extension to its euro zone loan agreement as it races to avoid running out of money within weeks. Persistent optimism that Greece will reach a deal with its international lenders, however, kept the euro from losing too much ground.
"The market has assigned very low probability of failure of a Greek agreement with its European creditors," said Sebastien Galy, senior foreign exchange analyst at Societe Generale in New York.
With its program due to expire in little more than a week, Athens urgently needs to secure a financial lifeline to keep the country afloat beyond late March. Euro zone finance ministers will meet on Friday afternoon in Brussels to consider the request.
The euro was last down 0.14 percent against the dollar at $1.13820. The dollar was last up 0.17 percent against the yen at 118.990 yen. The dollar was up 0.47 percent against the Swiss franc at 0.94645 franc after hitting 0.94920 franc, its highest since Jan. 15.
The dollar index, which measures the greenback against a basket of six major currencies, was last up 0.07 percent at 94.266.
On Wall Street, the benchmark S&P 500 stock index was last down 0.06 percent.
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