Dollar Strength Fueled by Hawkish Fed Commentary

The British pound and euro both traded lower on Wednesday as the US dollar maintained its strength due to hawkish Federal Reserve commentary.

Falling oil prices failed to dampen demand for the greenback, with the dollar index (DXY) reaching a near-term target of 101.0 'remains a very achievable near-term target' over the coming weeks according to ING's FX strategist Francesco Pesole.

Richmond Fed President Thomas Barkin argued that a single rate hike may not be enough to tame inflation, and resilient labour market conditions should keep consumer spending supported.