The dollar extended Tuesday's gains as European stocks and US futures came under pressure. The loonie fell a second day before the Bank of Canada's policy decision, while the Aussie outperformed its peers.
The Bloomberg Dollar Spot Index advances as much as 0.2%, following a 0.3% gain Tuesday; the yield on 10-year Treasuries climbs three basis points to 4.85%.
The Australian dollar met support from a hotter-than-expected inflation print.
AUD/USD rises as much as 0.7% to 0.6400, a two-week high, before erasing the advance as risk aversion gained traction after the London open.
Swaps traders lifted the odds of a Reserve Bank of Australia rate hike next month to better than 80% after September quarter core inflation eased less than expected to 5.2% year-on-year.
USD/CAD up 0.2% earlier to 1.3766, highest since Oct. 5; investors and economists expect Governor Tiff Macklem and his governing council to keep the benchmark overnight rate unchanged at 5% later Wednesday.
One-week risk reversals trade at 31 basis points in favor of the topside, compared to Tuesday low at 24 basis points.
USD/JPY was little changed at 149.89; most Bank of Japan watchers expect monetary easing to remain intact at next week's policy meeting.
EUR/USD swings between gains and losses, meets modest support from German Ifo data to trade slightly higher on the day at 1.0595.
Source: Bloomberg
