The dollar made headway against major currencies on Wednesday as markets digested minutes from the Federal Reserve's latest policy meeting.

The minutes said that Fed officials planned to review its quantitative easing programme in March, fuelling speculation that the central bank may have to scale back or end its bond buying programme before a pick-up in the US employment market.

The dollar index, which tracks the greenback versus a basket of six other currencies, rose 0.8 percent to 81.078. Traders also mulled mixed US housing data.

Permits for future home building issued in January rose to a 4.5-year high, the US Commerce Department reported. However housing starts fell 8.5% in January to a 890,000-unit annual rate.

Sterling skidded to more than a one year low on speculation of further monetary easing by the Bank of England. It traded 1.2% lower at $1.5238 after minutes from the Bank of England's latest meeting showed the policy makers may further loosen monetary policy.

Elsewhere the euro weakened 0.8% to $1.3278 after slipping to an intra-day low of $1.3273 earlier in the session.

Against the yen, the greenback gained 0.2% to ¥93.69 after Japanese Prime Minister Shinzo Abe was reported to have said Japan's need to create a fund to buy foreign bonds was reducing.

The yen was also pushed down by official data, which showed that Japan's trade deficit for January jumped to ¥1.63trn from ¥641bn in December.



CJ

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