The U.S. dollar plunged low Wednesday while Euro rallied 

The greenback traded in the red today, edging toward the multi-month lows it reached in the previous session. A missile strike on Poland bolstered the currency briefly due to its safe-haven nature. However, after the news said that Ukrainian air defenses had likely caused the blast, the U.S. currency plummeted again.

The dollar index tumbled by 0.44%, trading at 105.9 against the basket of six major currencies. Moreover, the greenback remained flat versus the Japanese yen, exchanging hands at 139.32 on Wednesday. The currency hovered near Tuesday’s two-and-a-half-month low of 137.67 against the JPY. At the same time, the dollar dropped by 0.5% on the Swiss franc at 0.9394, staying close to Tuesday’s seven-month low.

On the other hand, the Euro surged forward by 0.67% at $1.04205 on Wednesday. It was inching towards the four-and-a-half month high of $1.0481 hit on Tuesday. U.S. producer price inflation came in below traders’ expectations. This news bolstered bets that last week’s weaker consumer price inflation was just the beginning and that other similar reports would follow. If U.S. inflation continues lowering, the U.S. Federal Reserve will be able to slow or even pause the aggressive rate increases. The latter supported the greenback, pushing it to multi-decade highs versus the Euro, sterling, and yen this year, though.

Today geopolitical concerns also influenced trading. The Euro soared from as low as $1.028 on Tuesday when news of the explosion in Poland caused investors to rush to the safety of the greenback.

Ukraine and NATO member Poland initially announced that the blast was probably caused by a Russian missile. However, on Wednesday, Poland and NATO stated that a Ukrainian air defense missile was likely the culprit.