The dollar strengthened further on Wednesday as investors braced for the release of key US inflation data. The data is expected to offer insights into the Federal Reserve’s future policy decisions.

The U.S. Dollar Index, which measures the greenback against a basket of six major currencies, rose 0.2% to 95.35. The index has gained steadily this week, supported by positive economic data and rising Treasury yields.

Economists forecast that the Consumer Price Index (CPI) will show a moderate increase in August. A strong reading could reinforce expectations for the Federal Reserve to raise interest rates again in December.

“The market is pricing in a high probability of a December rate hike, and strong inflation data would only solidify that view,” said a currency strategist at a major bank. “However, a weaker-than-expected number could trigger a pullback in the dollar.”

The euro edged lower against the dollar, with EUR/USD trading at 1.1580. The Japanese yen also weakened, with USD/JPY rising to 111.60.

Elsewhere, the British pound remained under pressure amid ongoing Brexit uncertainty. GBP/USD traded near 1.3050.

Commodity currencies, such as the Australian and Canadian dollars, also weakened against the greenback.

Investors will be closely monitoring the US inflation data, which is due to be released later today, for further direction.