By Gina Lee

Investing.com – The dollar was down on Wednesday morning in Asia but held near a one-year high amid rising speculation that the U.S. Federal Reserve will announce the beginning of asset tapering in November 2021, followed by potential interest rate hikes by the middle of 2022.

This currency exchange rate that measures the greenback against various currencies dropped 0.20% to 94.332 at 11:17PM ET (3:17 GMT). On Tuesday, it touched 94.563 the first time since late Sept 2020.

It fell by 0.13%, to 113.45

While the pair fell 0.07%, 0.7344 was the decrease in comparison to 0.6940.

Inching up 0.2% to 6.4475, the pair gained 0.2%. Chinese data including and will come later today, while inflation data including and the price indexes will be published on Thursday.

It was up 0.2% to 1.3617.

Two Fed Vice Chair Richard Clarida and three Fed officials stated Tuesday that the U.S. economic recovery is strong enough for the bank to start to reduce its asset-purchase plan. The chance that the rate will rise by July 2022 is about 50-50 according to money markets.

Surging energy prices are fueling inflation worries and increasing bets that Fed might normalize its monetary policy sooner than anticipated. Two-year Treasury yields reached their highest point in 18 months at the last session, sending them to record highs.

Investors now await the , due later in the day, for clues to the Fed’s interest rate hike timeline.

Ray Attrill, head of foreign currency strategy at National Australia Bank (OTC) said that CPI is “the main economic draw” which “has the potential for Fed rate expectations to move again one way or the other.”

Inflationary pressures have been deemed temporary by most Fed policymakers. Investors will now be waiting for statements from Fed Governors Lael and Michelle Brainard, who are due to address investors later in the day. The minutes of the central bank’s most recent meeting will be released.

After reaching an all-time high of $57.855.79 for five months, bitcoin was trading at around $56,500.