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The dollar hovered near a two-decade peak against a basket of currencies on Wednesday, after yields on US Treasuries leaped ahead of an interest rate decision that is likely to set the tone in financial markets for months to come.

The US dollar index, which measures the greenback against a basket of currencies, was steady at 110.17 after a 0.57% overnight gain, and remained not far below a 20-year high of 110.79 hit this month.

“The next level we see the getting to in the near-term would be 112 points,” said Kristina Clifton, a senior economist and senior currency strategist at Commonwealth Bank of Australia. Sterling last traded $1.1381, languishing near a 37-year low of $1.1351, while the euro was 0.02% lower at $0.9967, extending by a smidge its 0.56% fall overnight.

The Canadian dollar fell to a two-year low overnight after official data showed a surprise slowdown in inflation.

 

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