The greenback extended its gains after touching session highs, following Federal Reserve Chair Kevin Warsh's reaffirmation of the central bank's dedication to price stability. The dollar spot index climbed as much as 0.5% during the trading session.

As widely expected, the Federal Reserve raised its benchmark interest rate by 25 basis points on Wednesday, with the latest dot plot indicating one additional rate hike later this year to curb inflationary pressures. In response, the US 2-year Treasury yield surged to a two-year peak, reflecting growing trader bets on further policy tightening from the Fed.

In currency markets, Sterling weakened 0.6% against the dollar to $1.3396. This decline came just one day ahead of the Bank of England's rate decision, as official data revealed that UK inflation rose for a second consecutive month, driven by surging gasoline prices. Meanwhile, USD/CAD advanced 0.5% to 1.3982, with market attention drawn to the European Union's proposal to grant Canada "quasi-member" status, a first for the bloc. The Euro slipped 0.5% versus the dollar to $1.1488, while USD/JPY gained 0.4% to 155.73.

Investors now shift their focus to upcoming central bank decisions and economic data releases to gauge the global monetary policy trajectory.