The U.S. dollar was higher against its most major trading partners in the European session on Wednesday, as investors focus on the Federal Reserve's monetary policy decision for further clues on the timing of tapering the bond buying program and economic growth outlook.

The Fed will conclude its two-day meeting at 2:00 pm ET, followed by a press conference with Chairman Jerome Powell half an hour later.

The central bank is not expected to change the benchmark lending rate and the asset purchase program worth $120 billion a month.

Investors look forward to the Fed statement for any mention of the timeframe for tapering the QE program.

Markets will be watching whether the risks arising from the outbreak of the Delta variant of COVID-19 could pose risks to economic outlook.

U.S. GDP data for the second quarter is due out on Thursday, followed by personal consumption data on Friday, which is the Fed's preferred inflation gauge.

The greenback strengthened to a 1-week high of 0.6929 against the kiwi and a 2-day high of 0.7335 against the aussie, off its early lows of 0.6969 and 0.7375, respectively. The greenback is poised to challenge resistance near 0.68 against the kiwi and 0.70 against the aussie.

The greenback recovered from its prior lows of 1.1830 against the euro and 109.74 against the yen, rising to 1.1800 and 110.11, respectively. If the greenback rises further, 1.16 and 112 are likely seen as its next resistance levels against the euro and the yen, respectively.

The greenback was trading at 1.3865 against the pound, up from near a 2-week low of 1.3895 seen at 3:15 am ET. On the upside, 1.35 is likely seen as its next resistance level.

In contrast, the greenback held steady against the franc, after retreating to 0.9132 at 4:45 am ET. The pair had closed yesterday's deals at 0.9143.

Looking ahead, Canada CPI, U.S. wholesale inventories and advance goods trade balance, all for June, are due in the New York session.

At 2:00 pm ET, the Fed announces its decision on interest rate. Economists widely expect the federal funds rate to be kept at 0-0.25 percent.

AUD vs US Dollar (FX:AUDUSD)
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