U.S. Dollar Rises As Trader's Focus On U.S. Fed Minutes

(RTTNews) - The U.S. dollar strengthened against other major currencies in the European session on Wednesday, as investors ?await the minutes of the Federal Reserve's September meeting for fresh clues on its monetary policy outlook.

Fed rate hike expectations for October continue to remain low. The likelihood of a quarter percentage rate hike by the Fed in October has increased to 21.6 percent, from 19.9 percent a day earlier, the CME FedWatch tool shows.

European shares drifted lower with renewed Middle East tensions and France's deepening fiscal crisis keeping investors on edge.

Brent crude futures traded above $101 a barrel following more attacks on vessels in the Persian Gulf region.

German, French and Italian bond yields jumped as investors refocused on fiscal worries.

Yields rebounded on fears Iran is stepping up attacks on tankers in the Strait of Hormuz.

In a statement on the social media platform X, Yemen's Houthi group claimed that it carried out a series of drone and ballistic missile attacks targeting airports and military installations in Saudi Arabia.

Also, the Houthis denied being pushed back by government forces after Yemen's military said it had removed the pro-Iran group from areas around the Bab al-Mandab strait - a Red Sea chokepoint - and the port city of Mocha.

In the European trading today, the U.S. dollar rose to 2-day highs of 1.1165 against the euro and 1.3194 against the pound, from early lows of 1.1255 and 1.3268, respectively. If the greenback extends its uptrend, it is likely to find resistance around 1.10 against the euro and 1.30 against the pound.

Against the yen and the Swiss franc, the greenback climbed to nearly a 2-week high of 158.51 and a 6-day high of 0.8339 from early lows of 157.85 and 0.8317, respectively. The greenback may test resistance around 159.00 against the yen and 0.84 against the franc.

Against Australia and the New Zealand dollars, the greenback climbed to 2-day highs of 0.6943 and 0.5586 from early highs of 0.6985 and 0.5625, respectively. The next possible upside target for the greenback is seen around 0.67 against the aussie and 0.55 against the kiwi.

The greenback edged up to 1.4272 against the Canadian dollar, from an early low of 1.4210. The greenback may test resistance around the 1.43 region.

Looking ahead, U.S. EIA crude oil data and U.S. consumer inflation expectations for September are slated for release in the New York session.

At 2:00 pm ET, the US Federal Reserve is due to release minutes of its September policy meeting.