LONDON—The dollar weakened slightly against the euro ahead of Wednesday’s eagerly awaited Federal Reserve policy decision, with investors hoping the U.S. central bank will signal an end to interest rate tightening cycle.
The euro, meanwhile, was barely moved by data showing inflation in the bloc had eased for a third straight month in January.
After a series of jumbo rate increases in 2022 to tame inflation, the market expects the Fed benchmark interest rate to be raised by a quarter of a percentage point to 4.75 percent. That would be the smallest increase since the central bank began raising rates 10 months ago….