Dollar Holds Near Multi-Week Highs Amid Fed Decision Jitters

The US dollar held near multi-week highs on Wednesday as investors await the Federal Reserve's policy decision and a Bank of Japan meeting later this week. The dollar has gained more traction in recent sessions, with markets increasingly expecting the Fed to resume raising rates.

'When the Fed tightens, it normally raises rates at sequential meetings, which is our current expectation despite the proximity of the October policy meeting to the midterm elections,' analysts at ANZ said in a note.

The yen weakened to around 155.34 per dollar, touching a one-week low of 155.43 in Asian trading. Markets see about an 80% probability that the BOJ will raise rates on Friday and are pricing two 25-basis-point increases by the end of January.