Wary FX traders kept the US Dollar subdued as they await the latest policy update from the Federal Reserve Bank. Analysts expect that the Fed is likely to raise interest rates at the conclusion of the policy meeting, with investors of Fed Funds futures pricing in a 90% likelihood. The question, however, is how many rate hikes might be on the table for the remainder of 2017 and onward into the coming years. Markets have already priced in a rate increase of 25 basis points, with two more hikes likely this year.

As reported at 9:50 am (GMT) in London, the USD/JPY was trading at 114.654 Yen, down 0.07%; the pair ranged from 114.5900 Yen at the low and 114.8800 Yen at the high in today’s trading session. The EUR/USD was up 0.17% to trade at $1.0625, off the low of $1.0604 and the session high at $1.0640. The GBP/USD was up 0.41% to trade at $1.2203, edging closer to the session peak set at $1.2255, while the low was set at $1.2145.

Sterling Recovers from Brexit Worries

The Pound Sterling is rebounding off yesterday’s 8-week trough on investors’ concerns over the Brexit process. On Monday, Theresa May, the Prime Minister, received backing from the UK Parliament to begin the Brexit process and the negotiations that will ultimately determine Britain, and Europe’s, future. The issue of a Scottish referendum to leave the United Kingdom is still being debated within the government, with Britain’s Minister to Scotland saying that a referendum next year, in the time frame demanded by Scotland’s First Minister Nicola Sturgeon, would be “impossible.”