Fed meeting minutes affirm expectations of further rate hikes...

• Fed meeting minutes affirm expectations of further rate hikes
• Sterling falls after inflation disappoints
• Euro weaker as Brexit negotiations drag on

(Recasts with Fed minutes, adds quote, updates prices)

The U.S. dollar index rose to its highest levels in a week on Wednesday after minutes from the Federal Reserve’s September meeting affirmed expectations that the U.S. central bank is likely to continue raising interest rates.

Every Fed policymaker backed raising interest rates last month and also generally agreed borrowing costs were set to rise further.

The dollar index hit session highs after the minutes were released, although the bulk of Wednesday’s rally came before the news.

“There was a pretty well-formed expectation that it would more likely showcase a Fed that’s more confident and assertive debating tighter policy,” said Richard Franulovich, head of FX strategy at Westpac Banking Corp in New York.

The dollar index .DXY gained 0.49 percent to 95.510 after earlier reaching 95.562, the highest since Oct. 10.

Interest rate futures are now pricing in a 78 percent likelihood that the U.S. central bank raises rates in December for the fourth time this year, up from 77 percent before the minutes, according to the CME Group's FedWatch Tool. Two more increases are further likely next year.

Sterling weakened after the European Union's chief Brexit negotiator, Michel Barnier, said on Wednesday much more time was needed to secure an exit deal for Britain.

The British pound had weakened earlier on Wednesday after consumer price data for September came in at an annual rate of 2.4 percent versus forecasts of 2.6 percent.

Some market analysts warned against buying into the dollar's strength, however, saying financial conditions appeared to be tightening globally.

Cross-currency basis swaps in euros, yen and sterling - money market gauges of offshore dollar liquidity - have widened in recent weeks, suggesting the Fed's rate hikes have cut into the availability of overseas dollars.

"Risk caution is warranted ... the replacement of Fed liquidity has come at the expense of tightening liquidity conditions outside the U.S.," Morgan Stanley strategists said.

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	Currency bid prices at 2:33PM (1833 GMT) 

 Description	  RIC		 Last		   U.S. Close  Pct Change	 YTD Pct	 High Bid	Low Bid 
											  Previous				   Change				  
											  Session											
 Euro/Dollar	  EUR=		$1.1516		$1.1573	 -0.49%		 -4.00%	  +1.1583	 +1.1508 
 Dollar/Yen	   JPY=		112.3900	   112.2500	+0.12%		 -0.25%	  +112.4700   +112.0200 
 Euro/Yen		 EURJPY=	 129.46		 129.91	  -0.35%		 -4.23%	  +130.1500   +129.1900 
 Dollar/Swiss	 CHF=		0.9943		 0.9906	  +0.37%		 +2.05%	  +0.9949	 +0.9901 
 Sterling/Dollar  GBP=		1.3124		 1.3184	  -0.46%		 -2.87%	  +1.3192	 +1.3101 
 Dollar/Canadian  CAD=		1.3008		 1.2932	  +0.59%		 +3.43%	  +1.3022	 +1.2932 
 Australian/Doll  AUD=		0.7119		 0.7140	  -0.29%		 -8.74%	  +0.7159	 +0.7112 
 ar																							  

 Euro/Swiss	   EURCHF=	 1.1451		 1.1466	  -0.13%		 -2.04%	  +1.1482	 +1.1438 
 Euro/Sterling	EURGBP=	 0.8773		 0.8780	  -0.08%		 -1.24%	  +0.8807	 +0.8767 
 NZ			   NZD=		0.6562		 0.6582	  -0.30%		 -7.39%	  +0.6601	 +0.6558 
 Dollar/Dollar																				   

 Dollar/Norway	NOK=		8.2090		 8.1450	  +0.79%		 +0.02%	  +8.2158	 +8.1413 
 Euro/Norway	  EURNOK=	 9.4533		 9.4292	  +0.26%		 -4.01%	  +9.4630	 +9.4177 
 Dollar/Sweden	SEK=		8.9527		 8.9035	  +0.04%		 +9.16%	  +8.9646	 +8.8904 
 Euro/Sweden	  EURSEK=	 10.3122		10.3082	 +0.04%		 +4.81%	  +10.3315	+10.2870