By Anneken Tappe

Currency markets saw choppy trade Wednesday, as themes driving major pairs including Brexit and worries about Italy remained firmly in place.

The U.S. dollar was among the better-developed market performers, with the ICE U.S. Dollar Index last up 0.4% at 95.384, counteracting Tuesday's sluggishness. U.S. traders are meanwhile awaiting the Federal Reserve's latest meeting minutes, which are due to be released at 2 p.m. Eastern. The U.S. Treasury's report on foreign exchange practices in which the U.S. could label China a currency manipulator (http://www.marketwatch.com/story/heres-how-far-the-us-may-go-in-criticizing-chinas-currency-practices-2018-10-16) is also looming.

In Brussels, a highly anticipated European Union summit is on the schedule. Market participants are watching for whether the talks can clear the way for an expected November meeting to complete a deal ahead of the U.K.'s departure from the bloc in March.

Read:What is Brexit and why is it proving so complicated? (http://www.marketwatch.com/story/what-is-brexit-and-why-is-it-so-complicated-2018-10-17)

The British pound last bought $1.3144, down from $1.3185 late Tuesday. This weakness was in part due to lower than expected consumer price data.

In European data, harmonized inflation for the European Union was unchanged at 2.1% for the year leading up to September, while U.K. harmonized consumer prices undershot expectations at 2.4% versus 2.6% expected.

The cooler British print was "dampening any need for Bank of England action in the immediate future," said Boris Schlossberg, managing director of FX strategy at BK Asset Management.

Anticipated interest rate increases in 2019 have been lending some support to analyst's medium term view on the Brexit-battered British pound.

Read:With 'no-deal' Brexit risk on the rise, analysts see uncertain path for pound (http://www.marketwatch.com/story/with-no-deal-brexit-risk-on-the-rise-analysts-see-uncertain-path-for-pound-2018-10-16)

Elsewhere, the Italian budget remains on investors' minds. The country's 2019 budget proposal which foresees a higher budget deficit will likely run up against some problems in Brussels. Italian undersecretary of the regions Stefano Buffagni said the country, which is the EU's forth largest economy, had to prepare for a possible downgrade of its credit rating. Investors are worrying about the financial state of Italy, as the country is considered to large to be bailed out in the way Greece was.

The euro last fetched $1.1533 from $1.1577 Tuesday.

(END) Dow Jones Newswires

October 17, 2018 13:58 ET (17:58 GMT)