The greenback marginally increased on Wednesday versus a basket of other currencies as recent positive economic data reduced recessionary fears but heightened worries about the potential persistence of the Federal Reserve's interest rate hikes to combat inflation.

U.S. business activity unpredictably surged in February to reach its highest level in eight months.

The dollar index that gauges the US dollar versus its major pairs edged up by 0.1% at 104.19

Fed funds futures traders now predict that the fed funds rate will increase to 5.35% in July and stay above 5% for the entire year. The Federal Reserve's target range has increased quickly from 0% to 0.25% in March 2022 to its current range of 4.5% to 4.75%.

Investor attention is now shifting to the release of the Fed's most recent meeting minutes later on Wednesday, which could provide additional information about the plans of policymakers.

EUR/USD slipped by 0.03% to 1.0644.

GBP/USD dipped 0.2% at $1.2082, post achieving earlier gains.