Heading into the European session, US dollar trading remained gloomy around 7-week lows following expectations that the Federal Reserve (Fed) will end its tightening.
In the Fed's statement after raising rates by 25 basis points, it dropped the statement of a 'continuing increase' in interest rates.
Instead, it now expects some additional policy tightening may be appropriate in the fight against inflation.
As a result, investors interpreted it as a signal that the Fed's tightening measures may be nearing the end, with another rate hike expected this year.
The dollar index, which measures the strength of the greenback, traded lower at 102.10 against a basket of major currencies.
Markets are now turning their attention to the Bank of England (BOE) policy meeting which is expected to raise rates by 25 basis points after seeing a rebound in inflation data in February.
During the European session, the pound traded stronger at a 7-week high against the greenback.
Meanwhile, the euro continued to maintain its strengthening momentum to also strengthen at a 7-week high against the USD.
After the BOE meeting, European and UK Zone manufacturing and services PMI data will be the next focus for investors on Friday.
On the other hand, the Aussie and New Zealand dollars also remained showing improvement to trade higher against the currency king US dollar.
In addition, the yen also continued to strengthen around a 6-week high against the US dollar, following lower US 10-year bond yields.
The Swiss franc currency rose following the decision of the Swiss National Bank (SNB) to raise the rate by 50 basis points to 1.50%.
