The US dollar rose on Wednesday, supported by climbing oil prices and anticipation of key signals from the Federal Reserve. Investors are closely watching for clues about potential rate hikes following the release of the Fed's September meeting minutes and remarks from policymakers. The euro retreated after earlier gains, while the yen weakened despite comments from a dovish Bank of Japan board member supporting interest rate increases.
Brent crude futures surged above $100 per barrel due to concerns over supply disruptions from a storm threatening US oil regions and attacks on Aden International Airport. Meanwhile, global bond yields have been rising amid expectations of central bank rate hikes and worries about government finances, particularly in France and Spain.
Expectations for an October Fed rate hike have dropped to 21.6%, down from 51% a week ago, though markets still anticipate a 68.6% chance of a hike in December. Fed officials are scheduled to speak later in the day, with consumer credit data also set for release. Cryptocurrencies saw declines, with Bitcoin falling 1.6% and Ether dropping 2.9%.