Forex Today: US Dollar firms as markets brace for Fed rate decision

Agustin Wazne FXStreet

Here is what you need to know on Wednesday, September 16:

The US Dollar Index (DXY) gained to 99.60 mark on Tuesday, and the bond market drove the move. The 10-year United States (US) Treasury yield touched 5.04% for the first time since 2007, pulled higher by a near 4% jump in Oil as surging energy costs revived inflation worries just as the Federal Reserve (Fed) prepares to decide on rates.

Markets price in roughly a 92% chance the Fed will raise rates on Wednesday, its first hike since 2023. With the move largely priced in, the reaction will hinge less on the decision itself than on the updated economic projections, the dot plot, and Chair Kevin Warsh's guidance on whether more tightening is coming. US Retail Sales earlier today will set the tone.

US Dollar Price Today

The table below shows the percentage change of US Dollar (USD) against listed major currencies today. US Dollar was the strongest against the Japanese Yen.

	USD	EUR	GBP	JPY	CAD	AUD	NZD	CHF
USD		0.07%	0.17%	0.51%	0.14%	0.14%	0.38%	0.16%
EUR	-0.07%		0.09%	0.43%	0.08%	0.06%	0.31%	0.09%
GBP	-0.17%	-0.09%		0.31%	-0.05%	-0.04%	0.19%	-0.01%
JPY	-0.51%	-0.43%	-0.31%		-0.36%	-0.36%	-0.12%	-0.34%
CAD	-0.14%	-0.08%	0.05%	0.36%		0.00%	0.24%	0.02%
AUD	-0.14%	-0.06%	0.04%	0.36%	-0.00%		0.24%	0.02%
NZD	-0.38%	-0.31%	-0.19%	0.12%	-0.24%	-0.24%		-0.22%
CHF	-0.16%	-0.09%	0.00%	0.34%	-0.02%	-0.02%	0.22%

The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).

EUR/USD drifted lower through the session, hovering near the 1.1540s as the firmer Dollar kept it pinned before the Fed.

GBP/USD stayed on the back foot near 1.3480, unable to make headway ahead of Wednesday's United Kingdom (UK) inflation report and the Fed decision.

USD/JPY held firm near the 155.00 mark, lifted by higher US yields but capped by expectations of a Bank of Japan (BoJ) hike on Friday.

AUD/USD could not hold its ground and eased near 0.7130s, weighed by the stronger Dollar.

Gold edged higher, trading north of $4,300 per troy ounce as inflation worries and Middle East risks supported demand.

West Texas Intermediate (WTI) Oil extended its rally, changing hands above $105 per barrel on Middle East supply worries.

Author

Agustin Wazne

FXStreet

Agustin Wazne joined FXStreet as a Junior News Editor, focusing on Commodities and covering Majors.

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