The US Dollar Index surges to 100.40, its highest since May 2025, amid rising bets on Federal Reserve tightening.
The US Dollar Index (DXY) climbed to 100.40, marking its highest level since May 2025, as traders priced in increased odds of a Federal Reserve rate hike. The index, which measures the dollar against six major currencies, rose 0.4% on Tuesday, extending its recent rally.
The move follows a shift in market expectations, with investors now anticipating a more aggressive Fed stance amid persistent inflation concerns. The DXY last traded at these levels over a year ago, before the central bank signaled a pause in its tightening cycle.
The dollar’s strength reflects growing conviction that the Fed may resume rate increases to curb inflation, despite earlier signals of a potential pause.