The GBP/USD pair loses ground to near 1.3470 during the early Asian trading hours on Wednesday. The US Dollar (USD) strengthens against the British Pound (GBP) on expectations of a US interest rate hike.

On Wednesday, the People’s Bank of China (PBOC) sets the USD/CNY central rate for the trading session ahead at 6.7628 compared to the previous day's fix of 6.7670 and 6.7148euters estimate.

The USD/CAD pair retains its positive bias for the sixth straight day, trading near the 1.3930 area, a two-week high during the Asian session on Wednesday amid a bullish US Dollar (USD).

The USD/JPY pair holds steady near 155.25 during the early Asian session on Wednesday. Traders prefer to wait on the sidelines ahead of the US Federal Reserve (Fed) interest rate decision later on Wednesday. On Friday, attention will shift to the Bank of Japan (BoJ) interest rate decision. 

The Aussie Dollar loses 0.11% against the Greenback on Tuesday as risk appetite remains negative amid calls from AI company CEOs to slow development, while the FOMC monetary policy meeting looms. Expectations for a Fed rate hike undermine the AUD/USD, which trades at 0.7130.

EUR/USD closed Tuesday near 1.1540, down 0.1%. It fell on the day the European Central Bank (ECB) raised its deposit rate to 2.50% and in each of the three sessions since.

The GBP/JPY edges higher by about 0.29% on Tuesday, even as risk appetite has shifted to the sour side due to geopolitical developments that are driving global bond yields higher amid inflation fears. At the time of writing, the cross-pair trades at 209.02 after bouncing off daily lows of 208.25.

GBP/USD closed Tuesday near 1.3470, down 0.2%. Wednesday's Asian and London hours are the last before the Fed is expected to raise its rate for the first time since July 2023. By the New York close its ceiling should sit a quarter-point above Bank Rate.

NZD/USD trades close to the 0.5760s, extending a run of losses that has dragged it toward the lower end of its recent range. A broadly firmer US Dollar (USD) is behind the slide, with the greenback supported by climbing United States (US) yields and rate-hike expectations.

The Mexican Peso loses some ground against the US Dollar as USD/MXN rises by over 0.09% amid a sour market mood and the strength of the Greenback, ahead of the September 16 FOMC monetary policy decision. The exotic pair trades at 17.15, after hitting a yearly low of 17.10.

The Euro extends its losses against the US Dollar, sliding below the 100-day Simple Moving Average (SMA) at 1.1555, opening the door to further downside, with sellers setting their sights on Monday’s low of 1.1523. The EUR/USD trades at 1.1548, slightly above the 50-day SMA of 1.1530.

USD/JPY trades near 155.20 on Tuesday, rising for a second straight day and pulling away from the roughly seven-month low it set last week. A firmer US Dollar (USD) is doing the work, helped by a sharp jump in Oil that has pushed US Treasury yields higher.

The New Zealand Dollar tumbles against the US Dollar for the second straight day this week, down 0.37% as risk appetite sours, with AI company CEOs expressing concerns about the rapid pace of evolution and as high energy prices push markets to expect further tightening by the Fed.

USD/CAD extends its advance for a fifth consecutive day on Tuesday, hovering near a two-week high as the US Dollar (USD) stays firmly supported ahead of the Federal Reserve’s (Fed) monetary policy announcement on Wednesday.

The Pound Sterling edges lower, by some 0.07%, against the Greenback on Tuesday, with the latter enjoying inflows due to its haven status amid fears of a possible Oil supply shortage. The GBP/USD trades at 1.3487, after peaking at around 1.3505.

EUR/GBP trades in the mid-0.8500s, unable to reclaim the 0.8600 barrier on Tuesday as the Euro (EUR) has struggled even after the European Central Bank (ECB) raised its three key rates by 25 basis points (bps) on September 10, lifting the deposit rate to 2.50%.

Scotiabank strategists Shaun Osborne and Eric Theoret observe USD/JPY trading higher as the Japanese Yen underperforms G10 peers ahead of trade, Consumer Price Index (CPI) and the Bank of Japan (BoJ) decision. A BoJ hike is fully priced, with risks focused on guidance for future moves.

UOB’s Quek Ser Leang reports GBP/USD slipped below 1.3475 before rebounding, with intraday trade now expected between 1.3470 and 1.3520. He notes building downside momentum and sees scope for further British Pound (GBP) weakness, though the major support at 1.3410 may not be tested immediately.

AUD/USD trades near the 0.7120s, down from the four-month highs it set near 0.7200 earlier this month. The US Dollar (USD), tracked by the US Dollar Index (DXY), holds just below the 100.00 mark and is firmer on the day as traders square positions before the main event.

USD/CHF extends its advance for a fifth consecutive day on Tuesday as the US Dollar (USD) stays firmly bid ahead of the Federal Reserve’s (Fed) monetary policy announcement on Wednesday. At the time of writing, the pair trades around 0.8191, near levels last seen on July 29.

Scotiabank strategists Shaun Osborne and Eric Theoret report EUR/USD is fractionally lower but stabilizing just above Monday’s one-month low in the mid/lower-1.15s.

USD/JPY extends its rebound on Tuesday and trades around 155.00 at the time of writing, up 0.41% on the day. The pair continues its recovery from levels below 153.00 reached last week, mainly supported by broad-based strength in the US Dollar (USD).

UOB’s Quek Ser Leang reports USD/JPY reversed earlier downside expectations, dipping to 153.29 before surging to 154.99 and closing at 154.35. The bank now sees scope for a move above 155.00, though 155.50 is likely out of reach near term.

Scotiabank strategists Shaun Osborne and Eric Theoret highlight that the Canadian Dollar (CAD) is effectively unchanged versus the US Dollar (USD) but outperforming peers, supported by firmer Oil and steady US-Canada front-end spreads.

EUR/USD remains on the back foot on Tuesday as rising US Treasury yields support the US Dollar. However, the pair lacks strong follow-through selling as traders avoid placing large bets ahead of the Federal Reserve’s (Fed) monetary policy announcement on Wednesday.

GBP/JPY trades on the front foot on Tuesday but remains confined to a narrow range following the Japanese Yen’s (JPY) sharp rally earlier this month.

UOB’s Quek Ser Leang highlights that USD/CHF extended gains to 0.8195 before consolidating, with intraday trade now expected between 0.8150 and 0.8195. He sees strong but overbought momentum and says a sustained move to 0.8245 requires a clear break and hold above 0.8205.

The New Zealand Dollar (NZD) keeps heading lower against the US Dollar (USD) on Tuesday, with NZD/USD bears pushing against two-month lows at 0.5765 after dropping beyond 2.5% so far in September.

OCBC strategist Christopher Wong notes USD/JPY has rebounded as higher UST yields, a firmer USD and rising Oil offset support from Bank of Japan (BoJ) tightening expectations. He warns against extrapolating gains ahead of Friday’s BoJ meeting, with markets almost fully pricing another hike.

The Swiss Franc (CHF) consolidates losses against the US Dollar (USD) on Tuesday, with the USD/CHF trading just below one-and-a-half-month highs at the 0.8200 level.