The US Dollar Index climbs to its highest level since July 2022 as traders price in prolonged Federal Reserve tightening.
The US Dollar Index (DXY) extended gains for a third straight session, trading above 101.50 and touching 101.60 in European trading. The move marks a 13-month high for the greenback against a basket of six major currencies.
The rally follows growing expectations that the Federal Reserve will maintain higher interest rates for longer to combat persistent inflation. Market participants have adjusted bets after recent hawkish commentary from Fed officials and stronger-than-expected economic data.
No immediate market reaction was specified, but the dollar’s strength reflects shifting rate expectations ahead of upcoming Fed communications.