US dollar index reverses and tumbles after FOMC minutes

The greenback initially rose after the release of the minutes from the latest FOMC meeting, but then reversed and trimmed gains. The US Dollar Index climbed to 100.88, hitting the highest level in three weeks and then dropped back toward 100.30/40. 

Currently is trading unchanged for the day at 100.35, as the US dollar remains weak in the market, following the reversal. 

The minutes showed no major surprises. The discussion about how to reduced the balance sheet presented more details and no relevant changes to the economic outlook were mentioned. “The minutes showed that most participants agree that allowing balance sheet to shrink later this year via a change to reinvestment policy would be appropriate. Furthermore, Fed meeting participants, in general, felt that the labor market continues to strengthen and the economic outlook hasn't changed much since January”, said analysts from Brown Brothers Harriman. 

FOMC minutes: Fed participants 'generally preferred' to change reinvestment of both treasury and mortgage-backed securities

CME Group FedWatch: Market expectations for a June rate hike at 62.7%

Trend change in stocks and bonds 

The bond market and equity prices also reversed sharply. US stocks indexes erased all gains with the Dow Jones losing more than 150 points after the minutes and it was up just 0.04%. In the bond market, the 10-year yield fell from 2.379% to 2.342% hitting a fresh daily low.