The dollar declined in European trade on Wednesday against a basket of major rivals away from recent five-week highs, which were scaled following strong US data.

The current decline comes ahead of an important speech by Fed member Christopher Waller, a known hawk, about the US battle with inflation and the future of interest rates.

The Index

The dollar index fell 0.1% today to 104.21, with a session-high at 104.42, after rising 0.1% on Tuesday away from a five-week high at 104.50.

The dollar was boosted by strong US durable goods orders data yesterday.

US Rates

The odds of a 0.25% Fed interest rate cut in May rose this week to 10%, while the odds of such a cut in June rose to 72%.

Traders continue to expect 75 basis points of total US interest rate cuts this year.

Christopher Waller

Now markets await Fed member Christpher Wallers speech on monetary policy later today in New York followed by responses to the audience.

Waller is a known policy hawk, and his remarks will likely impact current pricing for US interest rates.