The US dollar gained broadly on Wednesday during European trading hours, driven by expectations of a Federal Reserve rate hike in September. According to FX Street, the market now prices nearly a 70% probability of a Fed rate increase following a hawkish speech by former Fed governor Kevin Warsh. This sentiment has bolstered the dollar against major currencies and commodities.
The British pound fell amid the stronger dollar, as reported by Investing.com Forex, while the Indonesian rupiah extended its losses for the second consecutive day, trading around 17,810 USD/IDR according to FX Street. Meanwhile, silver prices came under pressure from rising US Treasury yields linked to the Fed’s hawkish stance, although silver briefly rebounded to near $64.00 per ounce.
Market participants will closely watch US inflation data due in August for further clues on the Fed’s policy direction. For Japanese investors, the strengthening dollar and hawkish Fed outlook continue to influence currency markets and risk sentiment, impacting FX and commodity-linked portfolios.