The USD index rose against the basket of six major currencies to end Wednesday’s session in the green at 94.46 due to investors expecting stronger inflation data and yet another interest rate hike after the country’s wholesale prices rose rapidly in June.
On Wednesday, the Labor Department of United States reported that the annual core PPI rose from 2.4 percent to 2.8 percent reaching its biggest increase since Jan 2012, the figure has beaten the expectations of an increase by 0.2 percent. Moreover, the year-on-year PPI rose by 0.3 percent reaching 3.4 percent while analyst expected an increase by 0.1 percent.
Meanwhile, the greenback found support from a weaker Euro where the single currency fell against the US Dollar to close the session in the red at 1.16722.
The drop came after the ECB policymakers differed in timing of interest rate hike, where some of them said that it possible to increase the interest rate on July 2019 while others preferred to postpone it until autumn 2019.
Meanwhile in the United Kingdom, The Sterling declined against the greenback to end the session lower at 1.32037 at the close.
Regarding to the safe-haven assets, fears over trade war has not resulted in investors to flood towards the safe-haven assets where the greenback rose against the Japanese Yen and Swiss franc to end the session in the green at 111.987 and 0.99581 respectively, while the precious metal prices fell against the USD to close in the red at 1241.58.
Elsewhere in Canada, despite that the Canadian interest rate came in line with expectations as the BOC decided to increase the rate by 25 basis points to reach 1.50 percent the loonie dollar dropped against the its U.S counterpart where USDCAD rose to trade higher at 1.32071 at the close.
The Canadian dollar was pressured by the sharp decline in oil prices where U.S crude oil finished lower at $70.59 per barrel.
In Asia, both the Aussie and Kiwi dollars were pressured by the positive economic data Stateside as both fell against their US counterpart to end the trading session sharply lower at 0.73660 and 0.67570 respectively.