USD rose against most of its major rivals in the European session on Wednesday, as demand for safe-haven currencies was strong amid lingering growth concerns, linked to both power-supply crunch in China and growing energy prices in Europe, and anxiety about accelerated near-term inflation and looming taper of the Fed's asset purchases.

The U.S. Dollar Index (DXY), measuring the U.S. currency's value relative to a basket of foreign currencies, increased 0.19% to 93.94.

Meanwhile, the further growth of the U.S. currency was capped by a pull-back in the U.S. Treasury yields and mounting fears about potential U.S. government shutdown later this week and debt ceiling chaos.

The yield on the benchmark 10-year Treasury note fell 3 basis points to 1.511% in the morning after hitting 1.541% at yesterday’s close.

Another Democrats’ effort to break a Senate stalemate failed to advance last night, raising worries about a potential U.S. credit default. In her congressional testimony on Tuesday, U.S. Treasury Secretary Janet Yellen warned that the Treasury's resources will likely be exhausted by October 18 if the debt limit isn't raised.

The Democratic lawmakers had hoped to avoid the government shutdown and to suspend the U.S. $28.4-trillion debt ceiling with a single vote, but the Senate Republicans refused to fast-track such a package. Later today, the Senate is to vote on the continuing resolution without a debt-ceiling attached to the government funding through December 3, aiming to avoid the shutdown.