The US Federal Reserve published the minutes of the July meeting

The minutes of the July 25-26 meeting held by the Federal Reserve have been made public.

With this backdrop, the dollar index rose to a new high above 103.5, surpassing the levels seen in early July.

Rates are expected to rise further, bolstering the US dollar according to the protocols.

On Wednesday, the US dollar strengthened against major currencies following the release of the minutes from the Federal Reserve's July meeting, which suggested that the regulator will maintain higher interest rates to combat inflation.

The minutes indicated that the majority of central bank officials still perceived considerable dangers of inflation increasing, which could necessitate additional tightening of monetary policy.

Members of the Federal Open Market Committee (FOMC) view the current sub-par economic growth and deteriorating labor market conditions as essential for restoring economic equilibrium.

At the July meeting, the Federal Reserve increased rates by 25 basis points, bringing them to a range of 5.25% - 5.50%, the highest level since 2001. This came after a pause in June.

Bloomberg reports that the most immediate cause of the dollar's strengthening is the fear that the Federal Reserve may raise rates again, and keep them higher than anticipated for a longer period of time.

The FxPro analyst team stated that the dollar is attempting to break the bearish trend. In the last month, the dollar index (DXY) has increased by more than 4%, completely recovering the losses it experienced in the first five trading sessions of July after the NFP. On Wednesday, the DXY surpassed the 200-day moving average, which is a long-term trend indicator.

If the growth continues beyond 103.5, it will show that the downward trend has been broken, leading to an increase in the range of 105.3-107.5 over the next few months.