The US dollar fell to its lowest point in nearly two weeks on Wednesday, while the euro rose as traders remained optimistic about the peace talks in Ukraine, despite warnings of economic damage in Europe.

Russia promised to reduce attacks on Kiev on Tuesday, but the United States stated that it did not see any "genuine signs" of Russia's pursuit of peace. The US dollar continued its decline on Wednesday, hitting a new low of 97.797. On 11.07 Greenwich Mean Time, the US dollar index fell 0.4% to 97.993 points. The euro rose 0.4% to 1.113 against the US dollar, hitting its highest level in four weeks.

Before the peace negotiations yielded any results, the market seemed to have taken an optimistic stance. The foreign exchange market may be increasingly detached from the trading Russia Ukraine situation and starting to catch up with widespread changes in interest rates and growth differences, all of which point to a stronger US dollar, "commented ING FX strategist.

Investors expect the Federal Reserve, which raised interest rates by 25 basis points at its meeting on March 16th, to be more hawkish than the European Central Bank, driving the US dollar higher against the euro. In Europe, data and policy makers' warnings highlight the stagnation of economic growth, plummeting confidence, and soaring inflation caused by the Ukrainian war.

On the other hand, after the meeting between Bank of Japan (BOJ) Governor Toshiko Kuroda and Prime Minister Fumio Kishida, the yen has recovered from its recent seven year low, exacerbating speculation about the level of official unease about the depreciation of the yen. On November 15, Greenwich Mean Time, the US dollar fell 0.9% against the Japanese yen to 121.83.

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