Forex Today: Dollar shrugs off dovish FOMC Minutes, ECB policy shift eyed, cryptos crumble

Here is what you need to know on Thursday, July 8:

Markets remain upbeat and the dollar refuses to fall despite the somewhat dovish FOMC Meeting Minutes. The ECB is set to announce more flexibility on its inflation target after concluding its strategic review. Gold, oil and cryptocurrencies are on the back foot.

Dollar strength: The greenback has been holding onto most of its gains, only marginally retreating after the Federal Reserve's minutes showed no urgency to taper the bank's bond-buying scheme.

While some members saw inflation as rising quicker than projected, that did not shock markets. Others stressed that the economy has not made enough progress and that more evidence is needed before acting. That message somewhat balanced the notion from the hawkish decision. The dollar dipped in the immediate aftermath but rebounded.

FOMC minutes break no new ground on policy or bond timing

The European Central Bank has concluded its strategic review and will publish the results on Thursday. ECB President Christine Lagarde is set to unveil a more balanced inflation target, aiming for a symmetric 2% goal rather than one that is "below, but close to 2%." 

The Frankfurt-based institution could include house prices in its Consumer Price Index calculations, thus pushing inflation higher and thus make ECB policy more hawkish. On the other hand, including unemployment and inequality in the bank's goals would result in a more dovish policy.

See ECB Strategic Review Preview: Three potential EUR/USD movers to watch

EUR/USD is hovering around 1.18 ahead of the ECB announcement, pushed lower by dollar strength and by concerns over the spread of the Delta covid variant in Spain and Portugal. GBP/USD is trading under 1.38 as worries about the UK's reopening persist.

Gold struggles to hold the $1,800 despite lower US yields and as the dollar remains strong. WTI Crude Oil tumbled below $72 on Wednesday as some speculate that the UAE could go it alone with raising its oil output, breaking away from Saudi Arabia. The OPEC+ meeting ended without an agreement.

Cryptocurrencies are on the back foot, with Bitcoin struggling under $34,000 and Ethereum retreating to below $2,300. The crackdown on Binance, one of the world's largest exchanges, is weighing on sentiment. 

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