Heading into the European session, the US dollar maintained its strength at six-month highs against most major currencies.
Against a basket of major currencies, the dollar index strengthened to around 104.77, at the time of writing.
The currency king posted a sharp jump on Tuesday following the 10-year US bond yield which rose at 4.22% after reopening from a long weekend break.
The strengthening of the greenback was also supported by the negative sentiment of the market which was influenced by concerns about the economic development in China.
The market is now focused on the publication of the US ISM services PMI data which is expected to continue to show expansion in August, with a slightly slower pace.
In addition, investors will also watch the interest rate decision by the Bank of Canada (BOC) which is expected to keep it unchanged at 5.00%.
The Canadian dollar fell further to a fresh six-month low ahead of the BOC meeting, while also being hit by oil prices retreating from nine-month highs.
Meanwhile, the euro and the pound remained hovering at the weakest level in three months compared to the greenback. At the end of the European session, there will be a discussion of the Bank of England (BOE) policy report.
The BOE governor and several other policymakers will testify on inflation and the economic outlook before the Parliamentary Finance Committee.
Although the impact is modest, investors may want to pay attention to any movement in the pound.
Meanwhile, the Aussie and New Zealand dollars remained trading at their lowest levels since November last year, pressured by a stronger US dollar.
