The U.S. dollar maintained its gains on Wednesday, reaching a two-week high as investors awaited the Federal Reserve’s interest rate decision. Traders largely anticipate no change in policy this time, but the CME Group’s FedWatch tool indicates a 78% chance of a 25-basis-point hike in December. The dollar index stood at 102.37, while the 10-year Treasury yield rose to 5.0%.
In the U.K., attention shifted to the government’s budget announcement, with finance minister John Healey expected to outline fiscal plans. The pound dipped slightly against the dollar and euro, but analysts hope for a fiscally responsible approach to avoid market selloffs. Any heavy reliance on borrowing could trigger a negative reaction in sterling and gilts.
The Canadian dollar edged up as the Bank of Canada prepared to raise rates by at least 25 basis points to curb energy-driven inflation. Meanwhile, the New Zealand dollar dropped 1.3% after the Reserve Bank of New Zealand kept rates unchanged, defying expectations of a hike.
In cryptocurrencies, bitcoin rose 0.7% to $81,292.46, and ether climbed 0.9% to $2,362.49. The week also includes monetary policy decisions from the European Central Bank and the Bank of Japan, with both expected to hold rates steady.