Forex - Dollar falls on release of Federal Reserve minutes

The dollar fell against most major currencies on Wednesday after the Federal Reserve released the minutes of its June monetary policy meeting, which weren't quite as hawkish as markets were expecting.

In U.S. trading on Wednesday, EUR/USD was up 0.84% at 1.2889.

Fed minutes released earlier revealed the some monetary authorities favored keeping stimulus programs in place despite improving economic indicators out of the U.S. housing, labor and manufacturing sectors of the economy.

Stimulus programs such as the Fed's monthly USD85 billion bond-buying program weaken the dollar to spur recovery.

"Many members indicated that further improvement in the outlook for the labor market would be required before it would be appropriate to slow the pace of asset purchases," the minutes read. 

"Some added that they would, as well, need to see more evidence that the projected acceleration in economic activity would occur, before reducing the pace of asset purchases."

Federal Reserve Chairman Ben Bernanke has said the U.S. central bank may begin scaling back asset purchases this year and end them next year if the economy improves, particularly the labor market.

The minutes revealed that Bernanke's colleagues want to be sure, as while some see the need to begin tapering soon, others felt they would "need to see more evidence that the projected acceleration in economic activity would occur, before reducing the pace of asset purchases," the minutes added.

While investors didn't view the Fed's language as dovish, they were expecting the Fed to begin tapering stimulus programs by September or October, though market talk on Wednesday said scale-backs may begin closer to December, which weakened the greenback.

The greenback was down against the pound, with GBP/USD trading up 0.49% at 1.4939.

The dollar was down against the yen, with USD/JPY down 0.98% at 100.15, and down against the Swiss franc, with USD/CHF trading down 0.91% at 0.9641.

The dollar was mixed against its cousins in Canada, Australia and New Zealand, with USD/CAD down 0.27% at 1.0499, AUD/USD down 0.58% at 0.9124 and NZD/USD trading down 0.75% at 0.7797.

The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was down 0.80% at 84.17.

On Thursday, the U.S. is to release the weekly government report on initial jobless claims, a leading economic indicator, as well as official data on import prices.