The green back plunged lower on Wednesday, trading in a tight range as traders are currently nervous ahead the release of inflation figures which may influence the interest rate trajectory.

The dollar index that gauges the greenback versus edged down by 0.1% at 102.147 post adding 0.2% on Tuesday.

The dollar has recovered from its 2% decline in December as traders thought at the start of 2024 to reevaluate the anticipated timing and scope of the interest rate reductions implemented by Fed in 2024.

The market is pricing in about 150 basis points of rate reduction this year, but this is contingent on inflation persisting to decline following the Fed's unexpectedly dovish stance in December.

EUR/USD edged up traded 0.2% higher at 1.0947, as the euro was buoyed by figures demonstrating that advanced by 0.5% on the month in November.

GBP/USD edged up by 0.1% to 1.2721, with the BOE, scheduled to testify later in the session before the UK Parliament.

USD/JPY edged 0.3% to 144.94 moving closer to 145 mark.