The dollar index rose to 96.4 on Wednesday after touching a four-year low of 96 earlier in the session as markets pared expectations that the US is engineering a devaluation in its currency to aid exporters. Treasury Secretary Bessent stated that the US noted that the US is committed to a strong dollar policy and is not intervening in the currency market to strengthen the yen. This went against earlier expectations that the US was coordinating an intervention in currency markets after the New York Federal Reserve conducted a rate check on the USDJPY on behalf of the presidential administration. Besides sustained signals that the administration would welcome a weaker dollar to balance the trade deficit, heightened economic policy uncertainty in the US amid a series of tariff threats against major trading partners also drove foreign investors to pivot away from dollar-denominated assets. Meanwhile, the Fed is expected to hold its funds rate in the first decision of the year.