The greenback muted on Wednesday as eased economic data increased projections of rate cuts while political uncertainty in Europe pushed the euro down.

Data released on Tuesday indicated that U.S. retail sales saw minimal growth in May, with downward revisions to the previous month's figures, pointing to sluggish economic activity in the Q2.

According to the CME FedWatch tool, markets are currently estimating a 67% probability that the Fed will start reducing interest rates in September, anticipating nearly 50 basis points of cuts by the end of the year.

Political unrest in France and throughout the broader European bloc is keeping the dollar index under pressure. The dollar index that gauges the greenback versus its major pairs steadied at 105.27.

EUR/USD inched down at $1.0732.

GBP/USD advanced by 0.15% to $1.2725.

Data revealed on Wednesday indicated that British inflation reached its 2% target in May for the first time in almost three years. However, underlying price pressures stayed robust.

The yen steadied at 157.83 per dollar, It remains under pressure primarily due to the significant interest rate gaps between Japan and the U.S.