Singapore – The US dollar held onto its overnight gains on Wednesday as markets awaited key inflation data expected this week, a major indicator for the direction of US monetary policy in the coming months.
The dollar index, which measures the greenback’s performance against a basket of six major currencies, stood at 97.834, little changed from its previous levels.
Despite its current gains, the index has fallen by about 10% since the beginning of 2025, due to volatile US trade policies and growing expectations of interest rate cuts by the Federal Reserve, which has diminished the dollar’s appeal as an investment asset.
In currency markets, the euro slipped slightly to $1.16985 after falling 0.5% in the previous session, while the British pound was steady at $1.3522. The Japanese yen saw little change, holding at 147.42 per dollar.
Conversely, the Australian dollar continued its positive performance, trading at $0.6587, approaching the seven-week high it reached during Tuesday’s session.
Markets are anticipating two important US inflation reports this week, which are expected to directly influence the Federal Reserve’s decisions on future interest rates amid an economic environment of caution and anticipation.