The U.S. dollar remained stable on Wednesday after reaching a four-week high against other major currencies the previous night. Market participants were anticipating key U.S. inflation data and updates to the Federal Reserve’s interest rate projections, both expected later in the day.

The dollar index, which measures the U.S. dollar against a basket of other currencies, stood at 105.26, following a peak of 105.46 since May 14. The U.S. dollar had rebounded after a robust jobs report released on Friday suggested persistent inflation and strong growth, reducing the likelihood of imminent rate cuts by the Federal Reserve. Market expectations for a rate cut in September decreased to about 56% from 77.8% a week earlier, according to CME’s FedWatch tool.

The U.S. Consumer Price Index (CPI) report, set for release at 1830 GMT, was predicted by economists to show a decline in headline inflation to 0.1% from 0.3% in the prior month, while core inflation was forecasted to remain unchanged at 0.3%. The Federal Reserve was anticipated to maintain the current interest rates between 5.25% and 5.5%. Focus would be on the Fed’s economic projections, referred to as the “dot plot,” and Chairman Jerome Powell’s news conference for indications on the timing of potential rate cuts. Analysts suggested that the number of projected rate cuts in 2024 might decrease from three to two.

The euro remained stable at $1.0740, while the British pound was unchanged at $1.27395. The Japanese yen held steady at 157.06 per dollar, slightly below the one-week high of 157.40 reached the previous day. Japan’s wholesale prices rose by 2.4% in May compared to the previous year. The Bank of Japan was expected to keep interest rates steady in their upcoming meeting, with discussions likely around bond-buying strategies to manage yen outflows and support economic growth.

In the cryptocurrency market, Bitcoin saw a slight decline, dropping 0.36% to $67,040.00.

($1 = 157.1100 yen)