Here is what you need to know on Wednesday, July 20:

The dollar selloff seems to have taken a break on Wednesday with the US Dollar Index moving sideways above 106.50 after having erased more than 1% so far this week. The benchmark 10-year US Treasury bond yield fluctuates above 3% and US stock index futures trade flat following the impressive risk rally witnessed earlier in the week. Inflation data from Canada and June Existing Home Sales from the US will be featured in the US economic docket. During the American trading hours, the European Commission will release the preliminary Consumer Confidence Index data for July. Finally, investors will pay close attention to the 20-yeas US Treasury note auction, which is scheduled to take place at 1700 GMT.

China reported more than 1000 coronavirus cases for the first time since May 20 and investors grow increasingly concerned over Chinese officials introducing additional restriction measures. Meanwhile, markets continue to scale down 100 basis points (bps) Fed rate hike bets for July.

Earlier in the day, the data published by the UK’s Office for National Statistics revealed that inflation in the UK, as measured by the Consumer Price Index, jumped to 9.4% on a yearly basis in June from 9.1% in May. Although this print came in higher than the market expectation of 9.3%, the British pound struggled to gather strength. Following Tuesday’s upbeat labor market data and Bank of England (BOE) Governor Bailey’s hawkish comments, investors seem to have already fully priced in a 50 bps BOE rate hike in August. As of writing, GBP/USD was posting modest daily gains above 1.2000.