Profit taking cut into the US Dollar's recent gains, driving it to its largest drop this month. The fall came despite widespread expectations that the Federal Reserve is possibly on the brink of a rate hike. Analysts are expressing some concerns that the Dollar rally may be over, and that the EUR/USD pair may not even approach parity as had been anticipated. One currency strategist in London said that the greenback's momentum had finally ebbed.

As reported at 11:16 am (BDT) in London, the EUR/USD was trading lower at $1.0931, a loss of 0.8%; the pair was trading within a relatively tight band with $1.0924 at the low end and $1.0967 at the top. The USD/JPY was also lower at 123.7395 Yen, down 0.10%, nearly at the mid-point of today's trading band. The US Dollar Index, used as a gauge of the greenback's relative strength, was lower at 97.312 .DXY, slipping from Tuesday's 3-month peak at 98.151 .DXY.

Wall Street Woes Impact Greenback

Many attribute the Dollar's broad declines to disappointing earnings reports from United Technologies and IBM. In fact, all of the major indices closed lower yesterday which sent investors over to the US bond market which, ultimately, put the US Dollar under pressure.