The U.S. dollar was holding steady against a currency basket on Wednesday as investors awaited the conclusion of the Federal Reserve meeting later in the day, with a rate hike fully priced in.
The U.S. dollar index, which measures the greenback’s strength against a basket of six major currencies, was little changed at 93.75 by 04:18 AM ET (08:19 AM GMT) in rangebound trade.
The U.S. central bank is widely expected to raise interest rates by a quarter of a percentage point to 2.25%, in what would be its third rate hike of the year.
With the rate hike fully priced in and investors also expecting another rate hike in December attention will be turning to the Fed’s plans for the direction of monetary policy in 2019.
Indications that the Fed is looking to remain hawkish next year would likely bolster the dollar, while suggestions that it may slow the pace of rate hikes or that it is coming to the end of its tightening cycle next year could send the greenback lower.
Market sentiment remained subdued after U.S. President Donald Trump’s appearance at the United Nations General Assembly, where he restated his administrations tough stance on trade saying that his country would "no longer tolerate abuse" on that front.
The dollar edged lower against the yen, with USD/JPY down 0.13% to 112.82.
The euro was flat, with EUR/USD at 1.1767, while sterling slipped lower, with GBP/USD dipping 0.14% 1.3159.